ohn Fleming, chief administrator for Valley View Hospital, is concerned about the costs for tests in the hospital's lab. Charges for lab tests are consistently higher at Valley View than at other hospitals and have resulted in many complaints. Also, because of strict regulations on amounts reimbursed for lab tests, payments received from insurance companies and governmental units have not been high enough to cover lab costs. Mr. Fleming has asked you to evaluate costs in the hospital's lab for the past month. The following information is available: Two types of tests are performed in the labblood tests and smears. During the past month, 1,450 blood tests and 4,300 smears were performed in the lab. Small glass plates are used in both types of tests. During the past month, the hospital purchased 21,500 plates at a cost of $53,105. 3,300 of these plates were unused at the end of the month; no plates were on hand at the beginning of the month. During the past month, 3,300 hours of labor time were recorded in the lab at a cost of $37,785. The lab's variable overhead cost last month totaled $29,370. Valley View Hospital has never used standard costs. By searching