Tennies Clinic uses client-visits as its measure of activity. During November, t

Question

Tennies Clinic uses client-visits as its measure of activity. During November, the clinic budgeted for 4,100 client-visits, but its actual level of activity was 4,090 client-visits. The clinic has provided the following data concerning the formulas used in its budgeting and its actual results for November Data used in budgeting Fixed Variable element element per per monthclient-visit Revenue $37.00 Personnel expenses Medical supplies Occupancy expenses Administrative expenses Total expenses $31,100 2,000 9,200 7,500 $49,800 $12.00 7.40 3.50 0.40 $23.30 Actual results for November $151,535 $ 80,140 Revenue Personnel expenses

Explanation / Answer

Computation Activity Variance

Particulars

Amount

Planning Budget

$31,100 +(4,100 x ($12.00)

$        80,300

Less :Flexible Budget

$31,100 +(4,090 x ($12.00)

$        80,180

Activity Variance

$              120

Personal Activity Variance $120 F

Hence 1st Option Correct

Computation Activity Variance

Particulars

Amount

Planning Budget

$31,100 +(4,100 x ($12.00)

$        80,300

Less :Flexible Budget

$31,100 +(4,090 x ($12.00)

$        80,180

Activity Variance

$              120

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