ECONOMICS

Detailed explanation-1: -In traditional cost accounting systems, the volume-based costing (VBC) is the most popular cost accounting method. In this method, the indirect costs are allocated to each cost object (services or units of a hospital) using a single indicator named a cost driver (e.g., Labor hours, revenues or the number of patients).

Detailed explanation-2: -The main purpose of hospital costing is to ascertain the cost of providing medical services. There are different departments in a hospital which are generally formed on the basis of functions performed by them.

Detailed explanation-3: -Case mix costing methods have been widely used for costing hospital services in MCHP research (Shanahan et al.

Detailed explanation-4: -Operation costing is an accounting method professionals use to calculate product costs using process and job expenses. This includes the prices of materials, labor and facility upkeep. Businesses often use process costing for simple production models in which products follow the same process every time.

Detailed explanation-5: -3. Operating (Service) Costing – This method is used in industries where service is provided in place of manufacturing goods. For example, Power supply, Railways, Hotels, Hospitals etc. In this method cost of providing service is ascertained.