Question
The maternity wing of the city hospital has two types of patients: normal and cesarean. The standard quantities of labor and materials per delivery for
The maternity wing of the city hospital has two types of patients: normal and cesarean. The standard quantities of labor and materials per delivery for 20X1 are:
NormalCesareanDirect materials (lbs.)9.021.0Nursing labor (hrs.)2.55.0
The standard price paid per pound of direct materials is $10.00. The standard rate for labor is $16.00. Overhead is applied on the basis of direct labor hours. The variable overhead rate for maternity is $30.00 per hour, and the fixed overhead rate is $40.00 per hour.
Actual operating data for 20X1 are as follows:
- Deliveries produced: normal, 4,000; cesarean, 8,000.
- Direct materials purchased and used: 200,000 pounds at $9.5035,000 for normal maternity patients and 165,000 for the cesarean patients; no beginning or ending raw materials inventories.
- Nursing labor: 50,700 hours10,200 hours for normal patients and 40,500 hours for the cesarean; total cost of labor, $580,350.
Compute the materials price and usage variances for each type of patient.
Compute the labor rate and efficiency variances for each type of patient.
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