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Question 3 of 3 710 Hart Labs, Inc. provides mad cow disease testing for both state and federal governmental agricultural agencies Because the company's
Question 3 of 3 710 Hart Labs, Inc. provides mad cow disease testing for both state and federal governmental agricultural agencies Because the company's customers are governmental agencies, prices are strictly regulated. Therefore, Hart Labs must constantly monitor and control its testing costs. Shown below are the standard costs for a typical test Direct materials (2 test tubes @ $1.70 per tube $3.40 Direct labor (1 hour @$32 per hour? 32.00 Variable overhead (1 hour $7.00 per hour) 7.00 Fixed overhead 1 hour $13.00 per hour) 13.00 Total standard cost per test $55.40 The lab does not maintain an inventory of test tubes. As a result, the tubes purchased each month are used that month. Actual activity for the month of November 2020, when 1,300 tests were conducted, resulted in the following Direct materials (2.730 test tubes) $4.368 Direct labor (1.339 hours) 41.509 Variable overhead 8.580 Fixed overhead 16.211 27
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