**SHOW YOUR WORK**

What is the amount of variance that is attributed to the difference between the budgeted and actual wage rate per hour? Use the following data to calculate the variances. The following information has been prepared for a home health agency.

	Budget	Actual
Wage Rate per Hour	$16.00	$17.00
Fixed Hours	320	320
Variable Hours per Relative Value Unit (RVU)	1.0	1.1
Relative Value Units (RVUs)	1,000	1,200
Total Labor Hours	1,320	1,640
Labor Costs	$21,120	$27,880
Cost per RVU	$21.12	$23.23

Budgeted costs at actual volume would be $25,344 ($21.12 1,200), and the total variance to be explained is $2,536 Unfavorable ($27,880 - $25,344). Be sure to specify whether the variance is favorable or unfavorable.