Transcribed Image Text: 1- B.3.B. Red Rose is a disease testing lab. Shown below are the standard costs for a typical test. Direct materials (2 test tubes @ $1.50 per

Transcribed Image Text: 1- B.3.B. Red Rose is a disease testing lab. Shown below are the standard costs for a typical test.
Direct materials (2 test tubes @ $1.50 per tube)
$ 3
Direct labor (1 hour @ $20 per hour)
$ 20
Variable overhead (1 hour @ $6 per hour)
$ 6
Fixed overhead (1 hour @ $12 per hour)
$ 12
Total standard cost per test
$ 41
The lab does not maintain an inventory of test tubes. Therefore, the tubes purchased each
month are used that month. Actual activity for the month of January 2021, when 2,500 tests
were conducted, resulted in the following.
Direct materials (5,200 test tubes @ $1.60 per tube)
$ 8,320
Direct labor (2,400 hours @ $21 per hour)
$ 50,400
Variable overhead
$ 14,800
Fixed overhead
$ 31,000
Monthly budgeted fixed overhead is $ 24,000.
(a) Compute the total, price and quantity variances for direct materials and direct labor and
the total, controllable and volume variances for overhead. Show the calculations.
(b) Make the closing entry for all variance accounts.

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