Problem S (20 points) Curro Hospital bases its budgets on patient visits. The ho

Question

Problem S (20 points) Curro Hospital bases its budgets on patient visits. The hospital's static budget for August appears below. Budgeted number of patient visits Budgeted variable overhead costs 8,700 Supplies(e $6.40 per patient visit) Laundry$8.90 per patient visit)774 $55,680 Total variable overhead cost Budgeted fixed overhead costs: Salaries Occupancy costs Total fixed overhead cost Total budgeted overhead cost $78,300 105,270 183,570 5316,680 Actual results for the month were: Actual number of patient visits Supplies Laundry Salaries Occupancy costs 9,100 170 $73,210 $78,940 5105,890 Prepare a flexible budget performance report in good form- indicate whether variances are favorable (F) or unfavorable (U) Required: Budgeted Planning Activity Flexible Spending Actual per Patient Visit (Variable cost on Description Budget Variance Budget Variance Expenses VARIABLE COSTS Supplies Subtotal Variable Costs FIXED COSTS Salaries Occupancy Costs Subtotal Fixed Costs Total Costs

Explanation / Answer

Variable Cost for Flexible Budget:

Supplies - 9100*6.4 =58,240

Laundry = 9100*8.9 =80990

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Budgeted per Patient Visit Planning Budget Activity Variance Flexible Budget Spending Variance Actual Expenses Variable Cost: Supplies 6.4 $          55,680 $          2,560 U $    58,240 $    3,930 U $    62,170 Laundry 8.9 $          77,430 $          3,560 U $    80,990 $    7,780 F $    73,210 Subtotal Variable Cost $        133,110 $          6,120 U $ 139,230 $    3,850 F $ 135,380 Fixxed Cost Salaries $          78,300 $                 -   $    78,300 $        640 U $    78,940 Occupancy Cost $        105,270 $                 -   $ 105,270 $        620 U $ 105,890 Subtotal fixed Cost $        183,570 $                 -   $ 183,570 $    1,260 U $ 184,830 Total Cost $        316,680 $          6,120 U $ 322,800 $    2,590 F $ 320,210

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