a. construct a flexible budget using these results flexible budget actual result
ID: 2384321 • Letter: A
Question
a. construct a flexible budget using these results
flexible budget actual results
1. volume
payer a 10000 11000
payer b 11500 12000
reimbursement
payer a 100 95
payer b 90 95
costs
variable costs
supplies 322500 350000
fixed costs
labor 1035000 1000000
overhead 500000 500000
forecasted
revenues
payer a 1,000,000 1,045,000
payer b 1,035,000 1,140,000
total revenues 2,035,000 2,185,000
profit 177,500 335,000
b. what are the profit, revenue and cost variance based on the flexible budget
Explanation / Answer
Budgeted variable costs : supplies per unit = 322500/(10000+11500)
Budgeted variable costs : supplies per unit = $ 15
a)
b. what are the profit, revenue and cost variance based on the flexible budget
Profit Variance = $ 35000 Favorable
Total Revenue Variance = $ 5000 Favorable
Total Cost Variance = $ 30000 Favorable
Note : Flexible Budget Variance is a Price Variance
Flexible Budget Performance Report Actual Result Flexible Budget Variance Volume Payer a 11000 11000 Payer b 12000 12000 Reimbursement Payer a 95 100 Payer b 95 90 Revenue Payer a 1,045,000 1,100,000 55,000 U Payer b 1,140,000 1,080,000 60,000 F Total revenues 2,185,000 2,180,000 5,000 F Variable costs Supplies 350,000 345000 5,000 U Fixed Cost labor 1,000,000 1,035,000 35,000 F overhead 500,000 500,000 0 None Total Cost 1,850,000 1880000 30,000 F Profit 335,000 300,000 35,000 FRelated Questions
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