Analyze the following scenario: The Hospital for Ordinary Surgery uses pharmaceuticals for its patients. It started the year on January 1, with an inventory of 1,000 doses of an antibiotic drug that cost $17 per dose. On January 2, it purchased another 300 does for $21 each. From January 3 through June 30 it used 800 doses. On July 1, it bought 500 more doses at $23 each. From July 2 through the end of the year it used 400 doses.

Question

Analyze the following scenario: The Hospital for Ordinary Surgery uses pharmaceuticals for its patients. It started the year on January 1, with an inventory of 1,000 doses of an antibiotic drug that cost $17 per dose. On January 2, it purchased another 300 does for $21 each. From January 3 through June 30 it used 800 doses. On July 1, it bought 500 more doses at $23 each. From July 2 through the end of the year it used 400 doses.

Answer 1

To analyze the scenario, we need to calculate the total cost of the antibiotic drug inventory at various points in time and track the usage of doses.

Let's break the scenario down step by step:

1. Start of the year (January 1):
- Inventory: 1,000 doses
- Cost per dose: $17

2. January 2:
- Purchased: 300 doses
- Cost per dose: $21

3. January 3 to June 30:
- Used: 800 doses

4. July 1:
- Purchased: 500 doses
- Cost per dose: $23

5. July 2 to December 31:
- Used: 400 doses

To calculate the total cost of each transaction, we multiply the number of doses by the cost per dose:

1. January 1 inventory: 1,000 doses x $17/dose = $17,000

2. January 2 purchase: 300 doses x $21/dose = $6,300

3. July 1 purchase: 500 doses x $23/dose = $11,500

Next, we need to calculate the remaining inventory at the end of each period. By subtracting the doses used from the total available, we can determine the remaining inventory:

1. January to June:
- Starting inventory: 1,000 doses
- Used: 800 doses
- Remaining: 1,000 doses - 800 doses = 200 doses

2. July to December:
- Starting inventory: 200 doses (from the previous period)
- Used: 400 doses
- Remaining: 200 doses - 400 doses = -200 doses

In this scenario, the negative inventory at the end of the year indicates a shortage of doses, as the hospital used more than was available.

To summarize the analysis:

- The hospital started the year with 1,000 doses at a cost of $17 per dose.
- It purchased an additional 300 doses on January 2 at a cost of $21 per dose.
- From January 3 to June 30, it used 800 doses, leaving a remaining inventory of 200 doses.
- On July 1, it purchased another 500 doses at a cost of $23 per dose.
- From July 2 to December 31, it used 400 doses.
- However, at the end of the year, the inventory showed a shortage of 200 doses.

This analysis provides a breakdown of the transactions and helps understand the usage and cost of the antibiotic drug throughout the year for The Hospital for Ordinary Surgery.