1. Rate for each activity pool in the clinic.

Activities (1) Annual cost (2) Cost driver (3) Days/Hour (4) Rate Calculator

Daily care 2.100.000 Nursing days 10.000 210 (1) ÷ (3)

Accommodation and feeding 4.500.000 Patient days 45.000 100 (1) ÷ (3)

After medical care 1.500.000 Consultation hours 82.000 18.292 (1) ÷ (3)

Total costs 8.100.000

2. Daily rate for each medical problem

Medical problem Nursing days Patient days Consultation hours Day rate/Patient days

Rate 210 100 18.2927

Medical 5.000 30.000 20.000

1.050.000 3.000.000 365.854 4.415.854 147.20

Typhoid Fever 3.000 12.000 15.000

63.000 12.000.000 74.390.5 21.043.905 175.37

Tuberculosis 1.500 1.800 20.000

315.000 180.000 365.854 860.854 478.25

Diarrhea 500 1.200 27.000

105.000 120.000 493.902,9 718.902,9 599.09

Total 8.100.001

3. Cost of providing medical services as fer ABC method

Number of patients days Rate Cost

Malaria 1.000 147.20 147.195,13

Typhoid Fever 300 175.37 52.609,76

Tuberculosis 700 478.25 334.776,56

Diarrhea 500 599.09 299.542,88

Total 2.500 834.124,33

4. Cost allocation can be simple as all activities are time drivers as it is easier to identify tasks or
activities performed in providing medical services and time spent on each of the activities.
As a final step, as the rate for patient day 1 activities, is calculated in the above example, by
assigning the cost of activities, the cost for the final product can be easily calculated. There
could be certain challenges in ABC, such as identifying cost drivers i.e., services provided and
assignment of common costs such as overheads, electricity charges, etc.