ajaysaini333023

The following information has been prepared for a home health agency.
budget actual
wage rate per hour $16.00 $17.00
fixed hour 320 320
variable hours per related value unit 1.0 1.1
relative value unites 1000 1200
total labor hours 1320 1640
labor cost $12120 $27880
cost per RUV $2112 $2323

Budgeted costs at actual volume would be $25,344 ($21.12

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.

1. What is the amount of variance that is attributed to the difference between the budgeted and actual wage rate per hour?

2. What is the amount of variance that is attributed to the change in labor productivity?

3. What is the amount of variance that can be attributed to the difference between budgeted and actual volume?

Does the Constitution keep its promises?

1. We-rescue-Dogs Kennel had a labor cost budget of $100,000 for the year. It expected its staff costs related to grooming, feeding, walking, and so on to vary in direct proportion with the number of dogs , based on an hourly rate of $20 for staff, and a need for 10 hours of staff time per dog (before the dogs were adopted). In its budget for the year, it planned on rescuing 500 dogs. It turned out that it rescued 640 dogs for the year. The staff average cost turned out to be just $16 per hour. Staff were paid a total of 6,000 hours. What is the total labor variance? Was it favorable or unfavorable? Why?

Did the number of dogs rescue result in a favorable or unfavorable volume variance?