City Municipal Hospital

City Municipal Hospital

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The head of the general surgery department at City Municipal Hospital was not happy with the current system of charging all major surgeries uniformly, since each type of surgery consumes different amounts of each surgical resource. He was wondering if it would be possible to get a handle on the costing of surgical procedures and thereby determine an appropriate pricing of surgical procedures. He has recently attended a one week course on Hospital Management conducted by a leading Institute of Management, where one of the professors mentioned Activity Based Costing as an alternative to traditional costing methodology.

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