Hagel Clinic uses client-visits as its measure of activity. During July, the cli
ID: 2498577 • Letter: H
Question
Hagel Clinic uses client-visits as its measure of activity. During July, the clinic budgeted for 2,300 client-visits, but its actual level of activity was 2,320 client-visits. The clinic has provided the following data concerning the formulas used in its budgeting and its actual results for July:
Data used in budgeting:
Fixed element per month Variable element per client-visit
Revenue - $44.60
Personnel expenses $23,200 $15.10
Medical supplies 900 7.40
Occupancy expenses 6,500 2.00
Administrative expenses 4,000 0.20
Total expenses $34,600 $24.70
Actual results for July:
Revenue $100,902
Personnel expenses $60,922
Medical supplies $18,648
Occupancy expenses $11,290
Administrative expenses $4,594
The spending variance for occupancy expenses in July would be closest to:
$150 F
$190 F
$150 U
$190 U
$150 F
$190 F
$150 U
$190 U
Explanation / Answer
Answer: Spending variance=(SR-AR)*Actual hours worked
=($11140*-$11290)
=$150 U
=6500+(2320*2)
=11140
Related Questions
Navigate
Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.