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:
Actual results for May:

-The activity variance for administrative expenses in May would be closest to:
A) $6 U
B) $6 F
C) $194 U
D) $194 F

Question

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:
  Actual results for May:
 
-The activity variance for administrative expenses in May would be closest to:
A) $6 U 
B) $6 F 
C) $194 U 
D) $194 F

Quizplus · Accepted Answer

11ea7761_177b_7010_81a5_83c98a3b56c4_TB2580_00 Because the flexible budget is less than the planning budget, the variance is favorable (F).

Kaina Clinic Uses Client-Visits as Its Measure of Activity