Fager Clinic uses client-visits as its measure of activity. During February, the clinic budgeted for 2,200 client-visits, but its actual level of activity was 2,250 client-visits. The clinic has provided the following data concerning the formulas used in its budgeting and its actual results for February: Data used in budgeting: Fixed element per month Variable element per client-visit Revenue - $ 68.20 Personnel expenses $ 32,300 $ 21.50 Medical supplies 1,200 12.50 Occupancy expenses 9,700 3.40 Administrative expenses 5,000 0.10 Total expenses $ 48,200 $ 37.50 Actual results for February: Revenue $ 156,210 Personnel expenses $ 80,445 Medical supplies $ 30,105 Occupancy expenses $ 16,800 Administrative expenses $ 5,015 The revenue variance for February would be closest to:
Master Budget
A master budget can be defined as an estimation of the revenue earned or expenses incurred over a specified period of time in the future and it is generally prepared on a periodic basis which can be either monthly, quarterly, half-yearly, or annually. It helps a business, an organization, or even an individual to manage the money effectively. A budget also helps in monitoring the performance of the people in the organization and helps in better decision-making.
Sales Budget and Selling
A budget is a financial plan designed by an undertaking for a definite period in future which acts as a major contributor towards enhancing the financial success of the business undertaking. The budget generally takes into account both current and future income and expenses.
Fager Clinic uses client-visits as its measure of activity. During February, the clinic budgeted for 2,200 client-visits, but its actual level of activity was 2,250 client-visits. The clinic has provided the following data concerning the formulas used in its budgeting and its actual results for February:
Data used in budgeting:
| Fixed element per month | Variable element per client-visit | ||||
| Revenue | - | $ | 68.20 | ||
| Personnel expenses | $ | 32,300 | $ | 21.50 | |
| Medical supplies | 1,200 | 12.50 | |||
| Occupancy expenses | 9,700 | 3.40 | |||
| Administrative expenses | 5,000 | 0.10 | |||
| Total expenses | $ | 48,200 | $ | 37.50 | |
Actual results for February:
| Revenue | $ | 156,210 | |
| Personnel expenses | $ | 80,445 | |
| Medical supplies | $ | 30,105 | |
| Occupancy expenses | $ | 16,800 | |
| Administrative expenses | $ | 5,015 |
The revenue variance for February would be closest to:
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