Asked by Tiffany Smith on Apr 25, 2024
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Lasserre Clinic uses patient-visits as its measure of activity. During November, the clinic budgeted for 2,800 patient-visits, but its actual level of activity was 3,000 patient-visits. The clinic uses the following revenue and cost formulas in its budgeting, where q is the number of patient-visits:Revenue: $50.40qPersonnel expenses: $36,200 + $15.60qMedical supplies: $1,500 + $8.80qOccupancy expenses: $8,700 + $2.80qAdministrative expenses: $4,300 + $0.40qThe clinic reported the following actual results for November:
Required:Prepare the clinic's flexible budget performance report for November. Label each variance as favorable (F) or unfavorable (U).
Patient-visits
A metric in healthcare indicating the number of times patients visit or are seen by healthcare providers.
Revenue
Revenue derived from regular trading activities, factoring in reductions for rebates and goods returned.
Cost Formulas
Equations used to calculate costs, including both fixed and variable components, for budgeting and cost management purposes.
- Determine the discrepancy in budget expectations versus actual results, recognizing whether the findings are positive or negative.
- Examine the fiscal condition by leveraging flexible budget reports.
- Exercise cost and revenue formulations for the purpose of generating budget outlines.
Verified Answer
Learning Objectives
- Determine the discrepancy in budget expectations versus actual results, recognizing whether the findings are positive or negative.
- Examine the fiscal condition by leveraging flexible budget reports.
- Exercise cost and revenue formulations for the purpose of generating budget outlines.
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