Question

Bartosiewicz Clinic uses client-visits as its measure of activity. During January, the clinic budgeted for 4,000 client-visits, but its actual level of activity was 3,980 client-visits. The clinic has provided the following data concerning the formulas used in its budgeting and its actual results for January:

Data used in budgeting:

	Fixed element per month			Variable element per client-visit
Revenue		-		$	36.00
Personnel expenses	$	28,000		$	12.00
Medical supplies		2,000			6.00
Occupancy expenses		11,000			1.00
Administrative expenses		7,000			0.10
Total expenses	$	48,000		$	19.10

Actual results for January:

Revenue	$	124,750
Personnel expenses	$	70,500
Medical supplies	$	21,050
Occupancy expenses	$	14,000
Administrative expenses	$	7,850

The activity variance for net operating income in January would be closest to:

Multiple Choice

$338 F

$338 U

$8,250 U

$8,250 F

Answer 1

Answer:

Activity variance for net operating income in January would be closest to =$338 U

Activity variance for net operating income

Activity variance
	Flexible Budget	Activity variance		Panning budget .
Client visit	3980			4000
Revenue	143280	720	U	144000
Personnel expenses	75760	240	F	76000
Medical supplies	25880	120	F	26000
Occupancy expenses	14980	20	F	15000
Administrative expenses	7398	2	F	7400
Total expenses	124018	382	F	124400
Net operating income	19262	338	U	19600