A large metropolitan health-care complex, General Hospital, has had difficulty controlling its accounts receivable. Costs currently available from the information system are inaccurate and have led to gross errors in reports to the various government funding agencies, which have indicated that the hospital appears to be operating at a deficit. The hospital administration is concerned that the poor quality of information could lead to their replacement.

With the participation of the billing department, a set of standard costs and standard amounts was developed for 2015. These standard costs can be used in a flexible budget with separate variable cost and fixed cost categories. The output unit is defined to be a single bill.

The accountant of General Hospital provides you with the following for April 2015:

Variable overhead costs, allowance per standard hour..................$ 12

Fixed overhead flexible budget variance..............................$ 240 F

Total budgeted overhead costs for the bills prepared...............$ 27,000

Production-volume variance..........................................$ 1,080 F

Variable cost rate variance............................................$ 2,400 U

Variable cost efficiency variance.....................................$ 2,400 F

Standard hours allowed for the bills prepared 1,800 labour-hours

Required

Calculate the following:

1. Actual hours of input used.

2. Fixed overhead budget.

3. Fixed overhead allocated.

4. Budgeted fixed overhead rate per hour.

5. Denominator level in hours.