Question

Burget Clinic uses client-visits as its measure of activity. During July, the clinic budgeted for 2,100 client-visits, but its actual level of activity was 2,110 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 - $47.10
Personnel expenses $22,700 $16.90
Medical supplies 1,600 6.50
Occupancy expenses 6,900 1.50
Administrative expenses 3,400 0.40
Total expenses $34,600 $25.30

Actual results for July:

Revenue $101,491
Personnel expenses 55,699
Medical supplies 15,895
Occupancy expenses 9,785
Administrative expenses 4,424

The revenue variance for July would be closest to: __________

a. $2,581 F
b. $2,110 U
c. $2,110 F
d. $2,581 U

Answer 1

Burget Clinic

The revenue variance for July would be closest to: __________

a. $2,581 F

Step-by-step explanation:

a) Data and Calculations:

Budgeted client-visits for July = 2,100

Actual client-visits for July = 2,110

Fixed element Variable element

per month per client-visit

Revenue - $47.10

Personnel expenses $22,700 $16.90

Medical supplies 1,600 6.50

Occupancy expenses 6,900 1.50

Administrative expenses 3,400 0.40

Total expenses $34,600 $25.30

Actual results for July:

Revenue $101,491

Personnel expenses 55,699

Medical supplies 15,895

Occupancy expenses 9,785

Administrative expenses 4,424

Budgeted Revenue = $98,910 ($47.10 * 2,100)