Buonocore Clinic uses client-visits as its measure of activity. During August, t

Question

Buonocore Clinic uses client-visits as its measure of activity. During August, the clinic budgeted for 2,800 client-visits, but its actual level of activity was 2,770 client-visits. The clinic has provided the following data concerning the formulas used in its budgeting and its actual results for August:

Data used in budgeting:

Actual results for August:

The personnel expenses in the planning budget for August would be closest to:

$74,232

$75,480

$75,036

$75,012

PLEASE SHOW ALL WORK! THANKS.

Fixed element per month Variable element per client-visit Revenue $46.20 Personnel expenses $31,800 $15.60 Medical supplies 1,800 6.10 Occupancy expenses 7,600 1.90 Administrative expenses     5,900     0.40 Total expenses $47,100 $24.00

Explanation / Answer

Budgeted fixed personnel expenses = $31800

Variable budgeted personnel expenses = $15.60*2800 = $43680

Total budgeted personnel expenses = $31800 + $43680

= $75480

Second option is correct.

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