Answer The Following Questions In Word Or Excel File 665805

Question

Answer The Following Questions In A Word Or Excel File And Submit To C Answer the following questions in a Word or Excel file and submit to Canvas. Show all work. Management has studied work patterns in the housekeeping department and estimates the number of hours to be worked as follows. Hours worked = (1,500 per month) + (0.50 X RVUs). For the coming month, management expects relative value units (RVU) to be 5,800. What should budgeted labor for the month be? Last year, the price for thermometer covers in a pediatrician’s office was $0.05 each. This year, the covers cost $0.06 each. If the office purchased 10,000 thermometer covers this year, what is the price variance? Please keep in mind that #2 requires for you to identify whether the answer is favorable or unfavorable; be sure to include that in your submitted response. As you are aware, the authors made a distinction in the book with examples.

Dr. Jack HW Helper · Accepted Answer

The following analysis addresses two key financial and operational questions faced by a healthcare practice: the budgeting of labor costs in the housekeeping department, based on expected work patterns, and the calculation of price variance for thermometer covers purchased. Each question involves applying fundamental management accounting principles to real-world scenarios, with specific calculations supported by explanations to determine whether variances are favorable or unfavorable. 1. Budgeted Labor Cost Calculation The management’s estimation model for housekeeping labor hours is given by the equation: Hours worked = 1,500 + 0.50 × RVUs For the upcoming month, the expected RVUs are 5,800. Plugging this value into the formula gives: Hours worked = 1,500 + 0.50 × 5,800 = 1,500 + 2,900 = 4,400 hours Assuming that the cost per labor hour remains consistent, the total budgeted labor cost can be calculated if the hourly wage rate is known. Since the hourly wage rate is not specified, we focus on the total hours as the primary resource estimate necessary for budgeting purposes. If wages are provided, the total budgeted labor expense can be obtained by multiplying the hours by the wage rate. 2. Price Variance Calculation for Thermometer Covers The price variance compares the actual cost incurred to purchase items against the standard or expected cost. It is calculated as: Price Variance = (Actual Price – Standard Price) × Quantity Purchased From the data: Standard price = $0.05 per cover Actual price = $0.06 per cover Quantity purchased = 10,000 covers Calculating the variance: Price Variance = ($0.06 – $0.05) × 10,000 = $0.01 × 10,000 = $100 This variance is unfavorable because the actual price ($0.06) exceeds the standard price ($0.05), resulting in an additional cost of $100 more than expected. Conclusion In summary, the budgeted labor hours for the upcoming month are estimated at 4,400 hours based on projected RVUs, which can be translated into a cost if the wage r

Answer The Following Questions In Word Or Excel File 665805

Answer The Following Questions In A Word Or Excel File And Submit To C

Paper For Above instruction

1. Budgeted Labor Cost Calculation

2. Price Variance Calculation for Thermometer Covers

Conclusion

References