Question

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 (round to one decimal place)? hours c. Calculate the time variance. Enter a favorable variance as a negative number using a minus sign and an unfavorable variance as a positive number. In your computation, round the standard direct labor rate to the nearest whole cent. Time variance $

Answer 1

Labor costs for the week are determined by multiplying the number of admissions by the standard times and the employee hourly wage. The standard hours are calculated by summing the time for all admissions, and the time variance shows how actual performance compares to standards.

Step-by-step explanation:

The question pertains to the evaluation of labor costs and variance for an admissions department in a hospital. To calculate the labor cost for the week, the total number of admissions is multiplied by the respective standard times and then by the hourly wage of the employees. The standard hours are found by adding the total time taken for both unscheduled and scheduled admissions. The time variance is calculated by subtracting the actual labor hours used from the standard hours for the actual volume of work. The variance indicates whether the department performed better (a negative variance) or worse (a positive variance) than the standard.

Answer 2

a. The amount actually spent on labor is $2,400

b. The Standard hours for actual volume of the week are 157.5 hours.

c. The time variance in amount is $37.5 unfavorable

Step-by-step explanation:

According to the given data we have the following:

Amount paid per hour = $15

Productive hours per week per person = 40

Hence, Total productive hours per week for 4 persons = 40*4 = 160

a. Therefore, the amount actually spent on labor = 160*15 =$2,400

In order to calculate the standard hours for the actual volume for the week, we have to calculate first the following:

Time taken by 140 unscheduled admissions = 140*30 = 4200 min

Time taken by 350 scheduled admissions = 350*15 = 5250 min

Total time taken = 4200+ 5250 = 9450 min = 157.5 hours

b. Therefore, The Standard hours for actual volume of the week = 157.5 hours

c. If the tandard hours for actual volume of the week is 157.5, hence 160-157.5 = 2.5 , so time variance in amount= 2.5 ×15=$37.5 and unfavorable.