Question

1. Which of the following activities is identified with a service business?

Fabrication
Diagnostic imaging
Assembly
Mixing



2. Jacobsville Hospital has budgeted costs of $850,000 in diagnostic imaging. The total estimated activity-based usage is 2,500 images. Total costs for the entire hospital are estimated to be $3,000,000. The activity rate per image is

$340
$1,200
$860
$1,540

Answer 1

1. The activity identified with a service business is **Diagnostic Imaging**. This activity primarily involves providing a service rather than manufacturing a product.

2. To find the activity rate per image for Jacobsville Hospital's diagnostic imaging, you can use the following formula:

\[
\text{Activity Rate} = \frac{\text{Budgeted Costs}}{\text{Total Estimated Activity-Based Usage}}
\]

Substituting the provided values:

\[
\text{Activity Rate} = \frac{850,000}{2,500} = 340
\]

Therefore, the activity rate per image is **$340**.