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 $$3\mathrm{.}50$ each and are disposed of after the test is completed.

Labor: Each blood test should require $0\mathrm{.}6$ hour to complete, and each smear should require $0\mathrm{.}30$ hour to complete. The average cost

of this lab time is $$11\mathrm{.}00$ per hour.

Overhead: Overhead cost is based on direct labor$-$hours. The average rate for variable overhead is $$6\mathrm{.}10$ per hour.

Required:

Compute a materials price variance for the plates purchased last month and a materials quantity variance for the plates used last

month.

For labor cost in the lab:

a$.$ Compute a labor rate variance and a labor efficiency variance.

b$.$ In most hospitals, one$-$half of the workers in the lab are senior technicians and one$-$half are assistants. In an effort to reduce costs,

Valley View Hospital employs only one$-$fourth senior technicians and three$-$fourths assistants. Would you recommend this policy be

continued?

$3-$a$.$ Compute the variable overhead rate and efficiency variances.

$3-$b$.$ Is there any relation between the variable overhead efficiency variance and the labor efficiency variance?

Complete this question by entering your answers in the tabs below.

Compute a materials price variance for the plates purchased last month and a materials quantity variance for the plates used

last month.

Note: Indicate the effect of each variance by selecting $"$F$"$ for favorable, $"$U$"$ for unfavorable, and "None" for no effect $($i$.$e$.,$

zero variance$).$ Input all amounts as positive values.

Materials price variance

Materials quantity variance