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John Fleming, chlef administrator for Valley View Hospital, 1s concermed about the costs for tests in the hospltal's lab. Charges for lab tests are consistently higher at Valley View than at other hospitals and have resulted in many complaints. Also, because of strict regulations on amounts reimbursed for lab tests, payments recelved from insurance companies and governmental units have not been high enough to cover lab costs Mr. Fleming has asked you to evaluate costs in the hospital's lab for the past month. The following information is avallable a. Two types of tests are performed in the lab-blood tests and smears. During the past month, 600 blood tests and b. Small glass plates are used in both types of tests. During the past month, the hospital purchased 13,500 plates at a 2700 smears were performed in the lab. cost of $38,070. 1700 of these plates were unused at the end of the month; no plates were on hand at the beginning of the month. c. Durng the past month, 1,700 hours of labor time were recorded in the lab at a cost of $18,105 d. The lab's variable overhead cost last month totaled $12,410 Valley Vlew Hospital has never used standard costs. By searching industry literature, however, you have determined the following nationwide averages for hospitat labs. Piates. Three plates are required per lab test. These plates cost $3.00 each and are disposed of after the test is Labor: Each biood test should require 0.6 hours to complete, and each smear should require 0.30 hours to complete completed. The average cost of this lab time is $1170 per hour Overhead Overhead cost is based on drect labor-hours. The average rate for varlable overhead is $6,80 per hour: 1. Compute a materials price variance for the plates purchased last month and a materlals quantity vartance for the Required: plates used last month 2. For labor cost in the lab. a. Compute a labor rate varlance and a labor efficiency varlance b. In most hospitals, one-half of the workers in the lab are senior techniclans and one-haif are assistants: in an effort to reduce costs, valley View Hospital employs onty one-fourth senior technicians and three-fourths assistants. Whould you. recommend that this policy be contnued? 3-a Compute the varlable overhead rate and efficiency vanances 3- b. Is there any relation between the variable overhead efficiency variance and the labor efficiency vartance? Complete this question by entering your answers in the tabs below. Compute a materials price variance for the plates purchased last month and a materials quantity variance for the plates used. last month. (Indicate the effect of each variance by selecting "F for favorable, "U for unftaverable, and "None- for no effect. (i.e., zero variance). Input all amounts as positive values.) 1. Compute a materlals price variance for the piates purchased last month and a materials quantity vanance for the Requlred: plates used last month. 2 For labor cost in the lab: b. In most hospltals, one-haif of the workers in the lab are senior technicians and one-half are assistants In an effort to a. Compute a labor rate vaniance and a labor efficiency variance reduce costs, Valley View Hospital employs only one-fourth senlor technicians and three-fourths assistants. Would you recommend that this policy be continued? 3-a. Compute the variable overhead rate and efficiency variances. 3-b. is there any relation between the variable overhead efficlency varlance and the labor efficlency variance? Complete this question by entering your answers in the tabs below. Compute a materials price variance for the plates purchased last month and a materials quantity variance for the plates used compute a materials price variance for the plates purchased last month and a mate " U " for unfavorable, and "None" for no effect (i.e., zero variance). Input all amounts as positive values.) For labor cost in the lab: Compute a labor rate varlance and a labor efficiency variance. In most hospitais, one-half of the workers in the lab are senior techniclans and one-half are assistants. In an effort to educe costs. Valley view Hospital employs only one-fourth senior techniclans and three-fourths assistants. Would you recommend that this policy be continued? 3-a. Compute the variable overhead rate and efficiency variances. 3-b. Is there any relation between the variable overhead efficiency variance and the labor efficiency variance? Complete this question by entering your answers in the tabs below. For labor cost in the lab, Compute a labor rate variance and a labor effidency variance. (Indicate the effect of each variance by selecting "F" for favorable, UU" for unfavorable, and "None" for no effect (i.e,, zero variance). Input all amounts as positive values. Required: 1. Compute a materlals price varlance for the plates purchased last month and a materials quantity varlance for the plates used last month. 2. For labor cost in the lab: a. Compute a labor rate varlance and a labor efficlency varlance b. In most hospitals, one-haif of the workers in the lab are senior techniclans and one-half are assistants. In an effort to reduce costs, Valley View Hospital employs only one-fourth senior techniclans and three-fourths assistants. Would you recommend that this policy be contunued? 3-a. Compute the variable overhead rate and efficiency variances. 3-b. Is there any relation between the varlable overhead efficiency vartance and the labor efficiency variance? Complete this question by entering your answers in the tabs below. In most hospitals, one-half of the workers in the lab are senlor technicians and one-half are assistants. In an effort to reduce costs, Valley View Hospital employs only one-fourth senior technicians and three-fourths assistants. Would you recommend that this policy be continued? Requlred: 1. Compute a materials price variance for the plates purchased last month and a materiais quantity varlance for the plates used last month. 2. For labor cost in the lab: a. Compute a labor rate variance and a labor efficlency variance. b: In most hospitals, one-haif of the workers in the lab are senior technicians and one-half are assistants. In an effort to reduce costs, Valley View Hospital employs only one-fourth senlor technicians and three-fourths assistants. Would you recommend that this policy be continued? 3-a. Compute the varlable overhead rate and efficlency variances. 3-b. Is there any relation between the variable overhead efficiency variance and the labor efficiency variance? Complete this question by entering your answers in the tabs below. Compute the variable overhead rate and efficiency variances. (Indicate the effect of each variance by selecting "F" for favorable, "U- for unfavorable, and "None" for no effect (i.e., zero variance). Input all amounts as positive values.) 1 Compute a materlals price variance for the plates purchased last month and a materials quantity varlance for the Required: plates used last month 2. For labor cost in the lab: a. Compute a labor rate varlance and a labor efficiency variance. b. In most hospitals, one-half of the workers in the lab are senlor technicians and one-half are assistants. In an effort to reduce costs, Valley View Hospital employs only one-fourth senior technicians and three-fourths assistants. Would you recommend that this pollcy be contunued? 3-a. Compute the variable overhead rate and efficiency variances 3-b. Is there any relation between the variable overhead efficlency variance and the labor efficiency variance? Complete this question by entering your answers in the tabs below. Is there any relation between the variable overhead efficiency variance and the labor efficiency variance

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