CA Intermediate · Cost and Management Accounting · Service Costing
Which of the following is the most appropriate cost unit for a hospital's in-patient ward when computing the cost of service?
The most appropriate cost unit for an in-patient ward is the patient-day, also called bed-day. The service is delivered over days of stay, so costs of the ward are collected and divided by patient-days. Kilometre-based units belong to transport services, not hospitals.
- APatient-dayCorrect
- BPer kilometre
- CPer tonne-kilometre
- DPer room-hour of AC use
Explanation
In hospital costing, the ward cost is usually measured per patient-day (or bed-day), since the service is consumed by patients staying overnight. Per kilometre and tonne-kilometre belong to transport costing, and per room-hour of AC use is only a cost driver for one expense, not the composite cost unit.
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