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: $61.70q
Personnel expenses: $39,000 + $16.10q
Medical supplies: $1,300 + $11.90q
Occupancy expenses: $8,200 + $2.20q
Administrative expenses: $5,900 + $0.20q

The 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: $61.70q
Personnel expenses: $39,000 + $16.10q 
Medical supplies: $1,300 + $11.90q
Occupancy expenses: $8,200 + $2.20q
Administrative expenses: $5,900 + $0.20q

The 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: $61.70q
Personnel expenses: $39,000 + $16.10q 
Medical supplies: $1,300 + $11.90q
Occupancy expenses: $8,200 + $2.20q
Administrative expenses: $5,900 + $0.20q

The 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