Accounting Chapter 8 19 Longview Hospital Performs Blood Tests Its

271. Longview Hospital performs blood tests in its laboratory. The following standards have

been set for each blood test performed:

Standard Quantity or Hours Standard Price or Rate

Direct materials 2.0 plates $2.75 per plate

Direct labor 0.2 hours $15.00 per hour

Variable overhead 0.2 hours $7.00 per hour

During May, the laboratory performed 1,500 blood tests. On May 1 there were no direct materials

(plates) on hand; after a plate is used for a blood test it is discarded. Variable overhead is

assigned to blood tests on the basis of standard direct labor-hours. The following events

occurred during May:

• 3,600 plates were purchased for $9,540

• 3,200 plates were used for blood tests

• 340 actual direct labor-hours were worked at a cost of $5,550

The direct materials purchases variance is computed when the materials are purchased.

The labor efficiency variance for May is:

272. Longview Hospital performs blood tests in its laboratory. The following standards have

been set for each blood test performed:

Standard Quantity or Hours Standard Price or Rate

Direct materials 2.0 plates $2.75 per plate

Direct labor 0.2 hours $15.00 per hour

Variable overhead 0.2 hours $7.00 per hour

During May, the laboratory performed 1,500 blood tests. On May 1 there were no direct materials

(plates) on hand; after a plate is used for a blood test it is discarded. Variable overhead is

assigned to blood tests on the basis of standard direct labor-hours. The following events

occurred during May:

• 3,600 plates were purchased for $9,540

• 3,200 plates were used for blood tests

• 340 actual direct labor–hours were worked at a cost of $5,550

The direct materials purchases variance is computed when the materials are purchased.

The variable overhead efficiency variance for May is:

273. Ortman Corporation makes a product with the following standard costs:

Standard Quantity or Hours Standard Price or Rate

Direct materials 7.9 liters $8.00 per liter

Direct labor 0.7 hours $17.00 per hour

Variable overhead 0.7 hours $1.00 per hour

The company reported the following results concerning this product in May.

Actual output 1,600 units

Raw materials used in production 12,490 liters

Actual direct labor-hours 1,090 hours

Purchases of raw materials 14,000 liters

Actual price of raw materials purchased $8.10 per liter

Actual direct labor rate $16.10 per hour

Actual variable overhead rate $0.90 per hour

The company applies variable overhead on the basis of direct labor–hours. The direct materials

purchases variance is computed when the materials are purchased.

The materials quantity variance for May is:

274. Ortman Corporation makes a product with the following standard costs:

Standard Quantity or Hours Standard Price or Rate

Direct materials 7.9 liters $8.00 per liter

Direct labor 0.7 hours $17.00 per hour

Variable overhead 0.7 hours $1.00 per hour

The company reported the following results concerning this product in May.

Actual output 1,600 units

Raw materials used in production 12,490 liters

Actual direct labor-hours 1,090 hours

Purchases of raw materials 14,000 liters

Actual price of raw materials purchased $8.10 per liter

Actual direct labor rate $16.10 per hour

Actual variable overhead rate $0.90 per hour

The company applies variable overhead on the basis of direct labor–hours. The direct materials

purchases variance is computed when the materials are purchased.

The materials price variance for May is:

275. Ortman Corporation makes a product with the following standard costs:

Standard Quantity or Hours Standard Price or Rate

Direct materials 7.9 liters $8.00 per liter

Direct labor 0.7 hours $17.00 per hour

Variable overhead 0.7 hours $1.00 per hour

The company reported the following results concerning this product in May.

Actual output 1,600 units

Raw materials used in production 12,490 liters

Actual direct labor-hours 1,090 hours

Purchases of raw materials 14,000 liters

Actual price of raw materials purchased $8.10 per liter

Actual direct labor rate $16.10 per hour

Actual variable overhead rate $0.90 per hour

The company applies variable overhead on the basis of direct labor–hours. The direct materials

purchases variance is computed when the materials are purchased.

The labor efficiency variance for May is:

276. Ortman Corporation makes a product with the following standard costs:

Standard Quantity or Hours Standard Price or Rate

Direct materials 7.9 liters $8.00 per liter

Direct labor 0.7 hours $17.00 per hour

Variable overhead 0.7 hours $1.00 per hour

The company reported the following results concerning this product in May.

Actual output 1,600 units

Raw materials used in production 12,490 liters

Actual direct labor-hours 1,090 hours

Purchases of raw materials 14,000 liters

Actual price of raw materials purchased $8.10 per liter

Actual direct labor rate $16.10 per hour

Actual variable overhead rate $0.90 per hour

The company applies variable overhead on the basis of direct labor–hours. The direct materials

purchases variance is computed when the materials are purchased.

The labor rate variance for May is:

277. Ortman Corporation makes a product with the following standard costs:

Standard Quantity or Hours Standard Price or Rate

Direct materials 7.9 liters $8.00 per liter

Direct labor 0.7 hours $17.00 per hour

Variable overhead 0.7 hours $1.00 per hour

The company reported the following results concerning this product in May.

Actual output 1,600 units

Raw materials used in production 12,490 liters

Actual direct labor-hours 1,090 hours

Purchases of raw materials 14,000 liters

Actual price of raw materials purchased $8.10 per liter

Actual direct labor rate $16.10 per hour

Actual variable overhead rate $0.90 per hour

The company applies variable overhead on the basis of direct labor–hours. The direct materials

purchases variance is computed when the materials are purchased.

The variable overhead efficiency variance for May is:

278. Ortman Corporation makes a product with the following standard costs:

Standard Quantity or Hours Standard Price or Rate

Direct materials 7.9 liters $8.00 per liter

Direct labor 0.7 hours $17.00 per hour

Variable overhead 0.7 hours $1.00 per hour

The company reported the following results concerning this product in May.

Actual output 1,600 units

Raw materials used in production 12,490 liters

Actual direct labor-hours 1,090 hours

Purchases of raw materials 14,000 liters

Actual price of raw materials purchased $8.10 per liter

Actual direct labor rate $16.10 per hour

Actual variable overhead rate $0.90 per hour

The company applies variable overhead on the basis of direct labor–hours. The direct materials

purchases variance is computed when the materials are purchased.

The variable overhead rate variance for May is:

279. Beakins Corporation produces a single product. The standard cost card for the product

follows:

Direct materials (4 yards × $5 per yard) $20

Direct labor (1.5 hours × $10 per hour) $15

Variable manufacturing overhead (1.5 hrs × $4 per hour) $6

During a recent period the company produced 1,200 units of product. Various costs associated

with the production of these units are given below:

Direct materials purchased (6,000 yards) $28,500

Direct materials used in production 5,000 yards

Direct labor cost incurred (2,100 hours) $17,850

Variable manufacturing overhead cost incurred $10,080

The company records all variances at the earliest possible point in time. Variable manufacturing

overhead costs are applied to products on the basis of standard direct labor-hours.

The materials price variance for the period is:

280. Beakins Corporation produces a single product. The standard cost card for the product

follows:

Direct materials (4 yards × $5 per yard) $20

Direct labor (1.5 hours × $10 per hour) $15

Variable manufacturing overhead (1.5 hrs × $4 per hour) $6

During a recent period the company produced 1,200 units of product. Various costs associated

with the production of these units are given below:

Direct materials purchased (6,000 yards) $28,500

Direct materials used in production 5,000 yards

Direct labor cost incurred (2,100 hours) $17,850

Variable manufacturing overhead cost incurred $10,080

The company records all variances at the earliest possible point in time. Variable manufacturing

overhead costs are applied to products on the basis of standard direct labor-hours.

The materials quantity variance for the period is:

281. Beakins Corporation produces a single product. The standard cost card for the product

follows:

Direct materials (4 yards × $5 per yard) $20

Direct labor (1.5 hours × $10 per hour) $15

Variable manufacturing overhead (1.5 hrs × $4 per hour) $6

During a recent period the company produced 1,200 units of product. Various costs associated

with the production of these units are given below:

Direct materials purchased (6,000 yards) $28,500

Direct materials used in production 5,000 yards

Direct labor cost incurred (2,100 hours) $17,850

Variable manufacturing overhead cost incurred $10,080

The company records all variances at the earliest possible point in time. Variable manufacturing

overhead costs are applied to products on the basis of standard direct labor-hours.

The labor rate variance for the period is:

282. Beakins Corporation produces a single product. The standard cost card for the product

follows:

Direct materials (4 yards × $5 per yard) $20

Direct labor (1.5 hours × $10 per hour) $15

Variable manufacturing overhead (1.5 hrs × $4 per hour) $6

During a recent period the company produced 1,200 units of product. Various costs associated

with the production of these units are given below:

Direct materials purchased (6,000 yards) $28,500

Direct materials used in production 5,000 yards

Direct labor cost incurred (2,100 hours) $17,850

Variable manufacturing overhead cost incurred $10,080

The company records all variances at the earliest possible point in time. Variable manufacturing

overhead costs are applied to products on the basis of standard direct labor-hours.

The labor efficiency variance for the period is: