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jonny [76]
3 years ago
7

Mcgahen Medical Clinic measures its activity in terms of patient-visits. Last month, the budgeted level of activity was 1,080 pa

tient-visits and the actual level of activity was 990 patient-visits. The clinic's director budgets for variable overhead costs of $3.30 per patient-visit and fixed overhead costs of $10,600 per month. The actual variable overhead cost last month was $3,380 and the actual fixed overhead cost was $8,780. In the clinic's flexible budget performance report for last month, what would have been the variance for the total overhead cost?
Business
1 answer:
kherson [118]3 years ago
6 0

Answer:

$1,707 Favorable

Explanation:

The variance will be the difference between the planned budget and the actual costs.

Variable costs are budgeted at $3.30 per customer visit, and fixed costs are $10,600 per month. There were 990 customer visits.

The variable cost budget will be

=$3.30 x 990

=$3,267

Fixed budget is $10,600

Total budget

= $10,600 + $3,267

=$13,867

the actual expenditure was

variable cost= $3,380

fixed costs=$8,780

total actual costs = $3,380 +$8,780

= $12,160

variance = $13,867 - $12,160

=$1,707

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