Bracken Clinic uses client-visits as its measure of activity. During September, the clinic budgeted for 2,100 client-visits, but its actual level of activity was 2,140 client-visits. The clinic has provided the following data concerning the formulas used in its budgeting and its actual results for September:Data used in budgeting: Actual results for September:
The spending variance for medical supplies in September would be closest to:
A) $392 F
B) $680 U
C) $680 F
D) $392 U

Question

Bracken Clinic uses client-visits as its measure of activity. During September, the clinic budgeted for 2,100 client-visits, but its actual level of activity was 2,140 client-visits. The clinic has provided the following data concerning the formulas used in its budgeting and its actual results for September:Data used in budgeting:  Actual results for September:
 The spending variance for medical supplies in September would be closest to:
A) $392 F 
B) $680 U 
C) $680 F 
D) $392 U

Quizplus · Accepted Answer

Spending variance = Actual cost - Budgeted cost

Actual cost = Actual quantity x Actual price
= 940 x $0.80
= $752

Budgeted cost = Budgeted quantity x Budgeted price
= 890 x $0.80
= $712

Spending variance = $752 - $712
= $40 F

Therefore, option C, $680 F is the closest answer.

Bracken Clinic Uses Client-Visits as Its Measure of Activity