CA Intermediate · Cost and Management Accounting · Service Costing
Which of the following is the most appropriate cost unit for a hospital that wants to cost its in-patient ward services?
The most appropriate cost unit is the patient-day, also called the occupied bed-day. Ward services such as nursing, bed and meals are consumed for every day a patient stays, so cost per patient-day measures output. Transport units and machine hours do not fit hospital ward services.
- APatient-dayCorrect
- BKilometre run
- CTonne-kilometre
- DMachine hour
Explanation
In-patient ward services are consumed for each day a patient occupies a bed, so the patient-day (occupied bed-day) is the standard cost unit. Kilometre run and tonne-kilometre are transport units. Machine hour is a production input measure, not a service output.
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