1)What is suppose to put in the Budgeted labor cost, actual labor minutes at budgeted labor rate and actual labor cost.

2)What is labor efficiency variance? F/U? What is labor rate variance? F/U?

I just need the answer for number 3. The labor variances. Thank you

9.500 125,000 11.000 156,600 11 DOU 156,600 11 Client nichts 12 Pounds of laundry processed 13 Costs 11 Laundry labor 15 Supplies 15 Water & water heating & softening 17 Maintenance 10 Supervisor's salary 12 Allocated aclministrative costs 20 Equipment depreciation 21 Total $ 9,000.00 $ $ 1,125.00 $ $ 1,750.00 $ $ 1,375.00 $ S 3.125,00 $ S 1.000.00 $ $ 1.250.00 $ $ 21,625.00 $ U 2,275.00 281.00 112.00 31/.00 - - - 3,318.00 S S S S $ $ S $ 11.2/5.00 1.109.00 2 2.00 1./22.00 3,125.00 1,000.00 1.250.00 27,9/1.00 $ - S S S $ S $ 1.237.00 166.00 308.00 1/8.00 625.00 2.000.00 $ S S $ S $ $ 12.12.00 1.8/5.00 2.500.00 2.200.00 5./50.00 5.000.00 1.250.00 29.087.00 None None None U None U U 1.11/1.00 S 23 2) Laundry labor - Spending varlance analysis Actual labor minutes il brudguld b ille Buscled Client rights ? Pound ollundry H 11,900 156,600 Actual lataci d S 28 Budgeld labor let Actualitats chour 9.00 10.20 | : clicy Williaria! Fivceable or In lucratile: tal Villarica Fictile: or Innlaugurabile: 31 Budged b V Actualitat illet minute: i minutt S S 0.1. 0.17 44 Budgled librin Kind * Acil latacar minu prepond Sheet1 0.49 0.47 TCG267. Spruce Street Shelter 2 of 2 the prior fiscal year's costs less 3 percent for the current year's budget. He decided to measure a tivity by client nights, and to set the budget for pounds of laundry processed at last year's level. which was approximately equal to the volume of each of the past three years, Quarterly budgets were computed as one-fourth of the annual budget. Mr. Donaldson hade ceived the report shown in Exhibit l in mid-January. He reflected on its content: A lot of my costs don'change, even if the number of pounds of laundry changes. I suppose laundry bor, supplies, water related items, and maintenance vary with changes in pounds, but that's about all Nevertheless, shouldn't my budget reflect those changes? Also, I hadn't planned for the fact that I was given a salary increase as of October 1-was I supposed to refuse it to help keep my budget in balance? Finally, I think it's important to note that I had to pay overtime to the staff because the department hecame inundated with laundry during the cold snap we had back in mid-December. Because of this, my average hourly rate for the whole three months was $10.20 instead of the 59.00 that was in my budget. In fact, and maybe this is a little picky, the average number of minutes it took my staff to wash a pound of laundry actually dropped from 48, which was my budget target, to 47 for the quarter. Somehow, even though it's pretty small, I think that should be taken into consideration. Assignment 1. What is your assessment of the method the administrator used to construct the budget? 2. Prepare a flexible budget for the laundry department. What does it tell you? 3. Compute the appropriate labor variances. What do they tell you? 4. What should Mr. Donaldson tell the administrator about his budget variances? SPRUCE STREET SHELTER Exhibit 1. Performance Report - Laundry Department October - December (Over) Under Budget % (Over) Under Budget Budget Actual: (25) Client nights Pounds of laundry processed 9,500 125,000 11.900 156,600 (2.400) (31.600) Costs Laundry labor $9,000 Supplies 1.125 Water and water heating and softening 1.750 Maintenance 1,375 Supervisor's salary 3,125 Allocated administrative costs 4,000 Equipment depreciation 1,250 Total $21,625 $12,512 1.875 2,500 2.200 3,750 5,000 1.250 $29.087 $(3.512) (750) (750) (825) (625) (1,000) $(7,462) laundry 9,000 /