Variance Analysis Exercise.xlsx = fe Exercise B Exercise A Exercise B ExerciseC
ID: 2564307 • Letter: V
Question
Variance Analysis Exercise.xlsx = fe Exercise B Exercise A Exercise B ExerciseC + Exercise B 2 HOSPITALITY HOSPITAL CATEGORY PLANNED ACTUAL 3 4 Patient Days 5 Pharmacy 6 Miscellaneous supplies 7 Fixed Overhead Costs 24000 30000 $100,000 $140,000 $56,000 $67,500 $708,000 $780,000 9 Instructions: 101. Determine the total variance between the planned and actual budgets. 11 2. Calculate the amount of unexplained variance and give a possible reason for 12 3. Prepare a flexible budget estimate for variable costs. Compare budget, flexibl 13 4. Determine what variance is due to change in volume and what variance is du 145. Determine the volume variance and rate variance based on per unit rates 15Explanation / Answer
Ans 1 Planned Actual Variance Patient Days 24000 30000 Pharmacy 100000 140000 40000 U Miscellaneous Supplies 56000 67500 11500 U Fixed overhead cost 708000 780000 72000 U ans 2 The unexplained variance is $72000 variance in fixed expenses. The possible reason for this variance is making wrong estimation of fixed expenses ans 3 Actual Spending Variance Flexible Activity varaince Planned Patient Days 30000 30000 24000 Pharmacy 140000 15000 U 125000 25000 U 100000 100000/24000*30000 Miscellaneous Supplies 67500 2500 F 70000 14000 U 56000 560000/24000*30000 Fixed overhead cost 780000 72000 U 708000 0 None 708000 Total 84500 U 39000 U ans 4 $84500 variance is due to change in rates $39000 U variance is due to change in volume ans 5 rate variance (84500/30000) 2.82 U per unit Volume variance (39000/6000) 6.5 U per unit
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