Edington Clinic uses client-visits as its measure of activity. During September, the clinic budgeted for 2,800 client-visits, but its actual level of activity was 2,850 client-visits. The clinic has provided the following data concerning the formulas to be used in its budgeting for September:
-The administrative expenses in the planning budget for September would be closest to:
A)$6,480
B)$6,405
C)$6,293
D)$6,485

Question

Edington Clinic uses client-visits as its measure of activity. During September, the clinic budgeted for 2,800 client-visits, but its actual level of activity was 2,850 client-visits. The clinic has provided the following data concerning the formulas to be used in its budgeting for September: 
-The administrative expenses in the planning budget for September would be closest to:
A)$6,480 
B)$6,405 
C)$6,293 
D)$6,485

Quizplus · Accepted Answer

Cost = Fixed cost per unit + Variable cost per unit F1F1F1S1F1F1F10 q
= $6,200 + $0.10 F1F1F1S1F1F1F10 2,800 = $6,480

Edington Clinic Uses Client-Visits as Its Measure of Activity