The University of Dental Health (UDH) is a state-run university focusing on the

Question

The University of Dental Health (UDH) is a state-run university focusing on the education and training of dentists, dental assistants dental hygienists, and other dental professionals. The university provides both traditional undergraduate courses to 17,550 students and continuing professional education (CPE) courses to 9,450 practicing professionals. UDH has just hired a new controller who wants to utilize ABC. The controller has identified three key activities performed by the universty and the cost of each of these activities . UDH has 3 buildings with a total of 270,000 square feet of classroom and facility space. Due to the large space requirements for labs and other training facilities, the undergraduate program utilizes 243,000 square feet. Total cost, $3,294,000 courses, and other student services to both groups. Total cost, $1,080,000 UDH offers 1,000 diferent instructional courses each year, 700 of which are undergraduate courses. Total cost, $3,500,000 . UDH offers career placement services for undergraduate students, career counseling for active professionals taking CPE

Explanation / Answer

Computation of activity rate for each of the three activities Activity activity cost driver cost (a) total activity driver (b) activity rate (a)/(b) facilities square feet 3294000 270000 12.2 services no of students 1080000 27000 40 instruction no of courses 3500000 1000 3500 Computation of cost driver values and activity proportions for each group of students Activity activity cost driver cost undergraduate (1)activity proportion=undergraduate/total CPE (2)Activity proportion= CPE/total total total proportion (1)+(2) Facilities square feet 3294000 243000 0.9 27000 0.1 270000 1 services no of students 1080000 17550 0.65 9450 0.35 27000 1 instruction no of courses 3500000 700 0.7 300 0.3 1000 1 Determine the amount of costs assigned to each group of student Activity activity cost driver cost undergraduate = cost x activity portion in part 2 CPE= cost * activity portion in part 2 undergraduate = cost x activity portion in part 2 CPE= cost * activity portion in part 2 facilities Square feet 3294000 2964600 329400 3294000*0.9 3294000*0.1 services no of students 1080000 702000 378000 1080000*0.65 1080000*0.35 instruction no of courses 3500000 2450000 1050000 3500000*0.70 3500000*0.3 total cost assigned (1) 6116600 1757400 no of students(2) 17550 9450 cost per students(1)/(2) 348.5242165 185.968254 Working Note no of students undergraduate course 17550 CPE PROFESSIONALS 9450 total 27000 Square feet Area by undergraduate course 243000 by CPE professionals(270000-243000) 27000 No of Courses 1000 undergarduate course 700 CPE Professional course(1000-700) 300

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