Kolstad Clinic uses patient-visits as its measure of activity. During September, the clinic budgeted for 2,200 patient-visits, but its actual level of activity was 2,600 patient-visits. The clinic uses the following revenue and cost formulas in its budgeting, where q is the number of patient-visits:Revenue: $61.70qPersonnel expenses: $39,000 + $16.10qMedical supplies: $1,300 + $11.90qOccupancy expenses: $8,200 + $2.20qAdministrative expenses: $5,900 + $0.20qThe clinic reported the following actual results for September:
Required:Prepare a report showing the clinic's revenue and spending variances for September. Label each variance as favorable (F) or unfavorable (U).

Question

Kolstad Clinic uses patient-visits as its measure of activity. During September, the clinic budgeted for 2,200 patient-visits, but its actual level of activity was 2,600 patient-visits. The clinic uses the following revenue and cost formulas in its budgeting, where q is the number of patient-visits:Revenue: $61.70qPersonnel expenses: $39,000 + $16.10qMedical supplies: $1,300 + $11.90qOccupancy expenses: $8,200 + $2.20qAdministrative expenses: $5,900 + $0.20qThe clinic reported the following actual results for September:
  Required:Prepare a report showing the clinic's revenue and spending variances for September. Label each variance as favorable (F) or unfavorable (U).

Quizplus · Accepted Answer

The Answer of Kolstad Clinic uses patient-visits as its measure of activity. During September, the clinic budgeted for 2,200 patient-visits, but its actual level of activity was 2,600 patient-visits. The clinic uses the following revenue and cost formulas in its budgeting, where q is the number of patient-visits:Revenue: $61.70qPersonnel expenses: $39,000 + $16.10qMedical supplies: $1,300 + $11.90qOccupancy expenses: $8,200 + $2.20qAdministrative expenses: $5,900 + $0.20qThe clinic reported the following actual results for September:
  Required:Prepare a report showing the clinic's revenue and spending variances for September. Label each variance as favorable (F) or unfavorable (U).

Kolstad Clinic Uses Patient-Visits as Its Measure of Activity