Marc Goudreau, administrator of Clearwater Hospital, was puzzled by the prior month's reports. "Every month, it's anyone's gues whether the lab will show a profit or a loss. Perhaps the only answer is to increase our lab fees again." "We can't," replied Rhoda Groves, the controller. "There are still a lot of complaints about the last increase, particularly from the insurance companies and government health units. They're now paying only about 84% of what we bill. I'm beginning to think th problem is on the cost side." To determine if the Clearwater lab costs are in line with those of other hospital labs, Goudreau has asked you to evaluate the co the past month. Groves has provided you with the following information: a. Two basic types of tests are performed in the lab_smears and blood tests. During the past month, 3,000 smears and 1,200 b tests were performed in the lab. b. Small glass plates are used in both types of tests. During the past month, the hospital purchased 10,000 plates at a cost of $ This cost is net of a 4% purchase discount. A total of 1,600 of these plates were unused at the end of the month; no plates w hand at the beginning of the month. c. During the past month; 1,800 hours of labour time were used in performing smears and blood tests. The cost of this labour ti $18,360.00 d. The lab's variable overhead cost last month totalled $9,450. e. Fixed overhead cost last month totalled $14,000. Clearwater Hospital has never used standard costs. By searching industry literature, however, you have determined the follow nationwide averages for hospital labs: Plates: Three plates are required per lab test. These plates cost $2.80 each and are disposed of after the test is complet Labour: Each smear should require 0.3 hours to complete, and each blood test should require 0.6 hours to complete. The av cost of this lab time is $12 per hour. Overhead: Overhead cost is based on direct labour-hours. The average rate of variable overhead is $5 per hour. The average fixed overhead is $10 per hour. These rates are based on a denominator activity level of 1 , 250 hours per month. Clearwater Hospital has never used standard costs. By searching industry literature, hovever, you have determined the following natlonwide averages for hospital labs: Plates, Three plates are required per lab test. These plates cost 42,80 each and are disposed of after the test is completed, Labeurt Lach smear should require 0,3 hours to complete, and each blood test should require 6,6 hours to complete, the average cost of this lab time 15412 per hour, Overheadroverhead cost is based on direct labour-hours. The average rate of variable overhead is 15 per haur, The average fate of fixed overhead is 7.10 per hour. These rates are based on a denominator activity level of 1 , 250 hours per manth. Required: 1. Compute the materials price variance for the plates purchased last month, and compute a materials quantity variance for the plates used last month, (Indicare the effect of each variance by selecting "F" for favorable, " U " for unfovorable, and "None" for no effect (i.e., zero variance), ) 2-a. Compute a labour rate variance and a labour efficiency variance for the lab. (Indicate the effect of each variance by selecting "F" for favorable, "U" for unfavorable, and "None" for no effect (i.e., zero variance). Do not round intermediate calculation and round your final answers to 1 decimal place.) 2-b. This part of the question is not part of your Connect assignment. 3-a. Compute the variable overhead spending 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).) 3-a. Compute the variable overhead spending 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).) 3-b. This part of the question is not part of your Connect assignment. 4. Compute the fixed overhead budget and volume variances. (Indicate the effect of each variance by selecting " F " for favorable, "U" for unfavorable, and "None" for no effect (i.e., zero variance).)