Northern Illinois Labs provides mad cow disease testing for both state and federal government

agricultural agencies. Because the company's customers are governmental agencies, prices are

strictly regulated. Therefore, Northern Illinois Labs must constantly monitor and control its

testing centers. Shown below is the standard cost card for a typical test.

Direct materials test tubes @ $ per tube $

Direct labor hour @ $ per hour

Variable overhead hour @ $ per hour

Total standard cost per test $

The lab does not maintain an inventory of test tubes. As a result, tubes purchased each month

are used that month. Actual activity for the month of November, when test were

conducted, resulted in the following actual results.

Direct materials test tubes $

Direct labor hours

Variable overhead

Compute the price and quantity variances for direct materials.

Compute the price and quantity variances for direct labor.

Compute the rate and efficiency variances for variable overhead.

Answer rating: 100% (QA)

Answer 1 Compute the price and quantity variances for direct ... View the full answer