Analyze Valley Hospital's admissions time variance Valley Hospital began using standards to evaluate its Admissions Department. The standard was broken into two types of admissions as follows: Standard Time to Type of Complete Admission Admission Record Unscheduled 30 min. Scheduled 15 min. The unscheduled admision took longer because name, address, and insurance information needed to be determined and verifled at the time of admission. Information was collected on scheduled admissions prior to admitting the patient, thus requiring less time in admissions. The Admissions Department employs four full-time people for 40 hours per week at $15 per hour. For the most recent week, the department handled 140 unscheduled and 340 scheduled admissions. a. How much was actually spent on labor for the week? b. What are the standard hours for the actual volume of work for the week? hours c. Compute the direct labor time variance, and report how well the department performed for the week. Enter a favorable variance as a negative number using a minus sign and an unfavorable variance as a positive number.
Variance Analysis
In layman's terms, variance analysis is an analysis of a difference between planned and actual behavior. Variance analysis is mainly used by the companies to maintain a control over a business. After analyzing differences, companies find the reasons for the variance so that the necessary steps should be taken to correct that variance.
Standard Costing
The standard cost system is the expected cost per unit product manufactured and it helps in estimating the deviations and controlling them as well as fixing the selling price of the product. For example, it helps to plan the cost for the coming year on the various expenses.
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For Step 3 for this problem, how was the actual productive minutes calculated? When I multiplied 140 x 40 x 60, the solution is 336,000. Can you explain how the answer is 9,600? Thank you.