Longview Hospital performs blood tests in its laboratory. The following standards have been set for each blood test performed:
Standard quality or hours standard price or rate
Direct materials 2.0 hours $2.75
direct labor 0.2 hours $15.00 per hour
variable overhead 0.2 hours $7.00 per hour
During May, the laboratory performed 1,500 blood tests. On May 1 there were no direct materials (plates) on hand; after a plate is used for a blood test it is discarded. Variable overhead is assigned to blood tests on the basis of direct labor hours. The following events occurred during May:
· 3,600 plates were purchased for $9,540
· 3,200 plates were used for blood tests
· 340 actual direct labor hours were worked at a cost of $5,550
The labor efficiency variance for May is