Hospital Software Sells and Installs Computer Software Used by Hospitals

Essay

Hospital Software sells and installs computer software used by hospitals for patient admissions and billing. Every sale requires that Hospital Services modify its proprietary software for the specific demands of the client. Prior to each installation, Hospital Software estimates the number of hours of programming time each job will require and the cost of the programmers. Programmers record the amount of time they spend on each modification, and variance reports are prepared at the end of each installation.
For the Denver General Hospital account, Hospital Software estimates the following labor standards: $$\begin{array} { | l | c | c | } \hline & \begin{array} { c } \text { Standard } \\\text { Hours }\end{array} & \begin{array} { c } \text { Standard Rate per } \\\text { Hour }\end{array} \\\hline \text { Junior } & 85 & \$ 23 \\ \text { programmer } & \\\hline \text { Senior } \\\text { programmer }&33 & \$ 31 \\\hline\end{array}$$ After the job was completed, the following costs were reported: $$\begin{array} { | l | c | } \hline \text { Junior programmer (98 hours) } & \$ 2,352 \\\hline \text { Senior programmer ( } 36 \text { hours) } & \$ 1,044 \\\hline\end{array}$$ Required:
Calculate the labor efficiency and labor wage rate variances for the junior and senior programmers on the Denver General Hospital account.
Compute the actual wage rates given the actual hours and actual cost: