Kaina Clinic uses client-visits as its measure of activity. During May, the clinic budgeted for 3,000 client-visits, but its actual level of activity was 2,970 client-visits. The clinic has provided the following data concerning the formulas used in budgeting and its actual results for May: Data used in budgeting: Fixed element per Variable element per client-visit $ 25.80 $ 7.10 month Revenue Personnel expenses Medical supplies $ 20, 200 900 4.60 Occupancy expenses Administrative expenses 5,500 0.70 3,500 0.20 Total expenses $ 30,100 $ 12.60 Actual results for May: $ 78,246 $ 42,647 $ 15,002 $ 7,289 $ 4,294 Revenue Personnel expenses Medical supplies Occupancy expenses Administrative expenses The activity variance for net operating income in May would be closest to:
Kaina Clinic uses client-visits as its measure of activity. During May, the clinic budgeted for 3,000 client-visits, but its actual level of activity was 2,970 client-visits. The clinic has provided the following data concerning the formulas used in budgeting and its actual results for May: Data used in budgeting: Fixed element per Variable element per client-visit $ 25.80 $ 7.10 month Revenue Personnel expenses Medical supplies $ 20, 200 900 4.60 Occupancy expenses Administrative expenses 5,500 0.70 3,500 0.20 Total expenses $ 30,100 $ 12.60 Actual results for May: $ 78,246 $ 42,647 $ 15,002 $ 7,289 $ 4,294 Revenue Personnel expenses Medical supplies Occupancy expenses Administrative expenses The activity variance for net operating income in May would be closest to:
Principles of Cost Accounting
17th Edition
ISBN:9781305087408
Author:Edward J. Vanderbeck, Maria R. Mitchell
Publisher:Edward J. Vanderbeck, Maria R. Mitchell
Chapter7: The Master Budget And Flexible Budgeting
Section: Chapter Questions
Problem 7E: Starburst Inc. has the following items and amounts as part of its master budget at the 10,000-unit...
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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.
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Transcribed Image Text:The activity variance for net operating income in May would be closest to:
Multiple Choice
$396 F
$486 U
$396 U
$486 F
Transcribed Image Text:Kaina Clinic uses client-visits as its measure of activity. During May, the clinic budgeted for 3,000 client-visits, but its actual level of activity was 2,970 client-visits. The clinic
has provided the following data concerning the formulas used in its budgeting and its actual results for May:
Data used in budgeting:
Fixed element per
Variable element
per client-visit
$ 25.80
$ 7.10
month
Revenue
$ 0
$ 20,200
Personnel expenses
Medical supplies
900
4.60
Occupancy expenses
Administrative expenses
5,500
0.70
3,500
0.20
Total expenses
$ 30,100
$ 12.60
Actual results for May:
$ 78,246
$ 42,647
$ 15,002
$ 7,289
$ 4,294
Revenue
Personnel expenses
Medical supplies
Occupancy expenses
Administrative expenses
The activity variance for net operating income in May would be closest to:
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