Asked by Ishmail Mgwena on Jun 11, 2024
Verified
Kolstad Clinic uses patient-visits as its measure of activity.During September, the clinic budgeted for 2,200 patient-visits, but its actual level of activity was 2,600 patient-visits.The clinic uses the following revenue and cost formulas in its budgeting, where q is the number of patient-visits:
Revenue: $61.70q
Personnel expenses: $39,000 + $16.10q
Medical supplies: $1,300 + $11.90q
Occupancy expenses: $8,200 + $2.20q
Administrative expenses: $5,900 + $0.20q
The clinic reported the following actual results for September: Required:
Prepare a report showing the clinic's revenue and spending variances for September.Label each variance as favorable (F)or unfavorable (U).
Revenue Variance
The difference between actual revenue and budgeted or forecasted revenue, often analyzed to understand the performance of a business.
Patient-Visits
An indicator used in healthcare to quantify the number of visits or interactions between patients and healthcare providers.
- Identify and figure out the variances between actual outcomes and anticipated budgetary performance, noting the pros and cons.
- Examine deviations in spending across various expense categories and comprehend their effects on financial outcomes.
Verified Answer
BT
Learning Objectives
- Identify and figure out the variances between actual outcomes and anticipated budgetary performance, noting the pros and cons.
- Examine deviations in spending across various expense categories and comprehend their effects on financial outcomes.
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