Cornerstones of Managerial Accounting 6th Edition by Maryanne Mowen,Don Hansen ,Dan Heitger

Exercise 20

Formation of an Activity Dictionary
A hospital is in the process of implementing an ABC system. A pilot study is being done to assess the effects of the costing changes on specific products. Of particular interest is the cost of caring for patients who receive in-patient recovery treatment for illness, surgery (noncardiac), and injury. These patients are housed on the third and fourth floors of the hospital (the floors are dedicated to patient care and have only nursing stations and patient rooms). A partial transcript of an interview with the hospital's nursing supervisor is as follows:
1. How many nurses are in the hospital?
2. Of these 100 nurses, how many are assigned to the third and fourth floors?
3. What do these nurses do (please describe)?
4. And what do you do?
5. What other lodging and care activities are done for the third and fourth floors by persons other than the nurses?
6. Do patients use any equipment?
7. Who or what uses the activity output?
Required:
Prepare an activity dictionary with three categories: activity name, activity description, and activity driver.