close solutoin list

Direct labor standards for nonmanufacturing expenses Englert Hospital began using standards to evaluate its Admissions Department. The standard was broken into two types of admissions as follows: Type of Admission Standard Time to Complete Admission Record Unscheduled admission 30 min. Scheduled admission 15 min. The unscheduled admission took longer because name, address, and insurance information needed to be determined and verified at the time of admission. Information was collected on scheduled admissions prior to the admissions, which was less time-consuming. The Admissions Department employs four full-time people (40 productive hours per week, with no overtime) at $15 per hour. For the most recent week, the department handled 140 unscheduled and 350 scheduled admissions. a. How much was actually spent on labor for the week? b. What are the standard hours for the actual volume for the week? c. Calculate a time variance and report how well the department performed for the week.

BuyFind

Accounting

27th Edition
WARREN + 5 others
Publisher: Cengage Learning,
ISBN: 9781337272094
BuyFind

Accounting

27th Edition
WARREN + 5 others
Publisher: Cengage Learning,
ISBN: 9781337272094

Solutions

Chapter
Section
Chapter 23, Problem 23.11EX
Textbook Problem

Direct labor standards for nonmanufacturing expenses

 Englert Hospital began using standards to evaluate its Admissions Department. The standard was broken into two types of admissions as follows:

Type of Admission Standard Time to Complete Admission Record
Unscheduled admission 30 min.
Scheduled admission 15 min.

 The unscheduled admission took longer because name, address, and insurance information needed to be determined and verified at the time of admission. Information was collected on scheduled admissions prior to the admissions, which was less time-consuming.

 The Admissions Department employs four full-time people (40 productive hours per week, with no overtime) at $15 per hour. For the most recent week, the department handled 140 unscheduled and 350 scheduled admissions.

 a.    How much was actually spent on labor for the week?

 b.    What are the standard hours for the actual volume for the week?

 c.    Calculate a time variance and report how well the department performed for the week.

Expert Solution

a.

To determine

Direct labor variances:

The difference between the actual labor cost in the production and the standard labor cost for actual production is known as direct labor cost variance. The direct labor variance can be classified as follows:

  • Labor rate variance.
  • Labor time variance.

To identify: The amount actually spent on labor for the week.

Explanation of Solution

Calculate the actual amount spent on labor for the week.

Actual weekly expenditure = (Number of people×Rate per hour×Hours per week

Expert Solution

b.

To determine

Calculate the standard hours for the actual volume for the week.

Expert Solution

c.

To determine

Calculate the direct labor time variance.

Want to see this answer and more?

Bartleby provides explanations to thousands of textbook problems written by our experts, many with advanced degrees!

See solution

Chapter 23 Solutions

Accounting
Show all chapter solutions
Ch. 23 - Direct materials variances Bellingham Company...Ch. 23 - Direct materials variances Dvorak Company produces...Ch. 23 - Direct labor variances Bellingham Company produces...Ch. 23 - Direct labor variances Dvorak Company produces a...Ch. 23 - Factory overhead controllable variance Bellingham...Ch. 23 - Factory overhead controllable variance Dvorak...Ch. 23 - Factory overhead volume variance Bellingham...Ch. 23 - Factory overhead volume variance Dvorak Company...Ch. 23 - Standard cost journal entries Bellingham Company...Ch. 23 - Standard cost journal entries Dvorak Company...Ch. 23 - Income statement with variances Prepare an income...Ch. 23 - Income statement with variances Prepare an income...Ch. 23 - Activity inputs and outputs The following are...Ch. 23 - Activity inputs and outputs The following are...Ch. 23 - Standard direct materials cost per unit Roanoke...Ch. 23 - Standard product cost Sana Rosa Furniture Company...Ch. 23 - Budget performance report Genie in a Botile...Ch. 23 - Direct materials variances The following data...Ch. 23 - Direct materials variances Silicone Engine Inc....Ch. 23 - Standard direct materials cost per unit from...Ch. 23 - Standard product cost, direct materials variance...Ch. 23 - Direct labor variances The following data relate...Ch. 23 - Direct labor variances La Barte Company...Ch. 23 - Direct tabor variances Greeson Clothes Company...Ch. 23 - Direct labor standards for nonmanufacturing...Ch. 23 - Direct labor standards for a service company One...Ch. 23 - Direct labor variances for a service company...Ch. 23 - Direct materials and direct labor variances At the...Ch. 23 - Flexible overhead budget Leno Manufacturing...Ch. 23 - Flexible overhead budget Wiki Wiki Company has...Ch. 23 - Factory overhead cost variances The following data...Ch. 23 - Factory overhead cost variances Blumen Textiles...Ch. 23 - Factory overhead variance corrections The data...Ch. 23 - Factory overhead cost variance report Tannin...Ch. 23 - Recording standards in accounts Cioffi...Ch. 23 - Recording standards in accounts The Assembly...Ch. 23 - Income statement indicating standard cost...Ch. 23 - Nonfinancial performance measures Diamond Inc. is...Ch. 23 - Nonfinancial performance measures Alpha University...Ch. 23 - Direct materials and direct labor variance...Ch. 23 - Flexible budgeting and variance analysis I Love My...Ch. 23 - Direct materials, direct labor, and factory...Ch. 23 - Factory overhead cost variance report Tiger...Ch. 23 - Standards for nonmanufacturing expanses Code Head...Ch. 23 - Direct materials and direct labor variance...Ch. 23 - Flexible budgeting and variance analysis Im Really...Ch. 23 - Direct materials, direct labor, and factory...Ch. 23 - Factory overhead cost variance report Feeling...Ch. 23 - Standards for nonmanufacturing expenses for a...Ch. 23 - Genuine Spice Inc. began operations on January 1...Ch. 23 - Ethics in Action Dash Riprock is a cost analyst...Ch. 23 - Communication The senior management of Tungston...Ch. 23 - Variance interpretation You have been asked to...Ch. 23 - Variance interpretation Vanadium Audio Inc. is a...

Additional Business Textbook Solutions

Find more solutions based on key concepts
Show solutions
NSF checks are subtracted from the bank statement balance on the bank reconciliation.

College Accounting, Chapters 1-27 (New in Accounting from Heintz and Parry)

ABANDONMENT OPTION The Scampini Supplies Company recently purchased a new delivery truck. The new truck costs 2...

Fundamentals of Financial Management, Concise Edition (with Thomson ONE - Business School Edition, 1 term (6 months) Printed Access Card) (MindTap Course List)

What are control limits, and how are they set?

Cornerstones of Cost Management (Cornerstones Series)