Invoices clients on a cost-plus basis


Problem:

Bill Watts awoke with intense pain in his side. After a 911 call, he was transported to the emergency room at Lodi Community Hospital, where he underwent surgery for a ruptured appendix. The surgical procedure required 30 minutes. His hospital stay lasted three days, one of which was classified as acuity level 2.

The following information has been retrieved from Lodi Community Hospital's cost information system.

Nursing:

Acuity level 1 $350 per day
Acuity level 2 $400 per day

Food services $65 per day
Operating room $450 per half hour
Laundry $35 per day
Emergency room admission $250 per admission
Emergency medical transportation $300

Calculate the cost incurred by Lodi Community Hospital to care for Bill.

Assume Lodi Community Hospital invoices clients on a cost-plus basis. If the markup percentage is 20%, what is the amount of Bill's invoice?

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Accounting Basics: Invoices clients on a cost-plus basis
Reference No:- TGS01906639

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