ohn Fleming, chief administrator for Valley View Hospital, is concerned about the costs for tests in the hospital's lab. Charges for lab ests are consistently higher at Valley View than other hospitals and have resulted in many complaints. Also, becouse of strict regulations on amounts feimbursed for lab tests, payments recelved from insurance companies and governmental units have not been high enough to cover lab costs. Mr. Fleming asked you to evaluate costs in the hospitars lab for the past month. The following information is available: a. Two types of tests are performed in the lab-blood tests and smears. During the past month, 1,000 blood tests and 3,400 smears were performed in the fab. b. Small glass plates are used in both types of tests. During the past month, the hospital purchased 17,000 plates at a cost of $53,040 2,400 of these plates were unused at the end of the month; no plates were on hand at the beginning of the month. c. During the past month, 2,400 hours of labor time were recorded in the lab at a cost of $26,400. d. The lab's varioble overhead cost last month totaled $19.200. Valley View Hospital has never used standard costs. By searching industry literature, however, you determined the following nationwide averages for hospital labs: Plates: Three plates are required per lab test. These plates cost $325 each and are disposed of after the test is completed. Labor: Each biood test should require 0.8 hour to complete, and each smear should require 0.40 hour to complete. The average cost of this lab time is $1160 per hour. Overhesd: Overheod cost is based on direct laborhours, The average rate for variable overhead is $7.50 per hout. Required: 1. Compute a materials price variance for the plates purchesed last month and a materials quansity variance for the plates used last month. 2. For labor cost in the lab. a. Compule a labor rate variance and o labor efficiency varience. b. in most hosprais, one-half of the workers in the lab ase senior technicians and one-haif are assistants. in an effort to reduce conts. Valley View Hospial employs oniy one-fourth senior technicians and three-fourths assistants. Would you recommend this policy be continued? 3. Compute the variabie overhead rate and efficiency variances. 3.: is there any relation between the variable overthead efliciency variance and the labor efficiency variance? Complete this question by entering your answers in the tats belew. law monkh