•Calculate the variance analysis for the information providedbelow using this problem and the formula provided to you.
Data:
| Budget | Actual | Variance |
| Total Payroll Cost | $65,600.00 | $78,627.50 | $13,027.50 |
| Total Nursing Hours | 1600 | 1850 | 250 |
| Composite Hourly Pay Rate | $30.00 | $33.00 | $3.00 |
| Patient Days | 350 | 375 | 25 |
Formulas to use in calculations for variance analysis:
Step #1: Compute the Efficiency Variance.
Budgeted nursing hours / Budgeted patient days =HPPD Budgeted
Actual nursing hours / Actual patient days = HPPD Actual
HPPD Actual - HPPD Budgeted
Actual patient days X extra nursing care hours = Total extra
Total extra X Budgeted hourly wage = Efficiency (in dollars)
Step #2: Compute the volume variance.
Actual patient days - Budgeted patient days = A
A X Budgeted HPPD = B
B X Budgeted pay = V (dollars)
Step #3: Compute the cost variance.
Actual $ paid - Budgeted $ paid = D
D X Actual hours worked = C (dollars)
Step #4: Calculate the Budget Variance.
Efficiency + Volume + Cost = Budget Variance
