Exam 9: Flexible Budgets and Performance Analysis

Leven Clinic uses client-visits as its measure of activity. During September, the clinic budgeted for 3,000 client-visits, but its actual level of activity was 3,050 client-visits. The clinic has provided the following data concerning the formulas to be used in its budgeting for September: -The personnel expenses in the planning budget for September would be closest to:

Keisker Clinic uses client-visits as its measure of activity. During November, the clinic budgeted for 2,200 client-visits, but its actual level of activity was 2,190 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: Actual results for November: -The activity variance for administrative expenses in November would be closest to:

Sherburne Snow Removal's cost formula for its vehicle operating cost is $2,510 per month plus $371 per snow-day.For the month of March,the company planned for activity of 18 snow-days,but the actual level of activity was 17 snow-days.The actual vehicle operating cost for the month was $8,460.The vehicle operating cost in the flexible budget for March would be closest to:

Dure Corporation's cost formula for its selling and administrative expense is $24,500 per month plus $1 per unit. For the month of July, the company planned for activity of 7,200 units, but the actual level of activity was 7,160 units. The actual selling and administrative expense for the month was $31,460. -The selling and administrative expense in the planning budget for July would be closest to:

Gordin Kennel uses tenant-days as its measure of activity; an animal housed in the kennel for one day is counted as one tenant-day. During May, the kennel budgeted for 3,000 tenant-days, but its actual level of activity was 3,020 tenant-days. The kennel has provided the following data concerning the formulas used in its budgeting and its actual results for May: Data used in budgeting: Actual results for May: -The facility expenses in the flexible budget for May would be closest to:

Chimilio Clinic uses client-visits as its measure of activity. During June, the clinic budgeted for 3,400 client-visits, but its actual level of activity was 3,360 client-visits. The clinic has provided the following data concerning the formulas used in its budgeting and its actual results for June: Data used in budgeting: Actual results for June: -The occupancy expenses in the flexible budget for June would be closest to:

Spohn Clinic uses client-visits as its measure of activity. During February, the clinic budgeted for 3,400 client-visits, but its actual level of activity was 3,370 client-visits. The clinic has provided the following data concerning the formulas to be used in its budgeting for February: -The administrative expenses in the planning budget for February would be closest to:

Shaak Corporation uses customers served as its measure of activity.The company bases its budgets on the following information: Revenue should be $3.20 per customer served.Wages and salaries should be $21,000 per month plus $0.80 per customer served.Supplies should be $0.70 per customer served.Insurance should be $5,300 per month.Miscellaneous expenses should be $3,100 per month plus $0.10 per customer served. The company reported the following actual results for October: Required: Prepare a report showing the company's revenue and spending variances for October.Label each variance as favorable (F)or unfavorable (U).

Lenci Corporation manufactures and sells a single product. The company uses units as the measure of activity in its budgets and performance reports. During May, the company budgeted for 5,100 units, but its actual level of activity was 5,050 units. The company has provided the following data concerning the formulas used in its budgeting and its actual results for May: Data used in budgeting: Actual results for May: -The spending variance for direct materials in May would be closest to:

Piechocki Corporation manufactures and sells a single product. The company uses units as the measure of activity in its budgets and performance reports. During May, the company budgeted for 5,900 units, but its actual level of activity was 5,940 units. The company has provided the following data concerning the formulas used in its budgeting and its actual results for May: Data used in budgeting: Actual results for May: -The revenue variance for May would be closest to:

Guareno Clinic uses client-visits as its measure of activity. During December, the clinic budgeted for 2,500 client-visits, but its actual level of activity was 2,450 client-visits. The clinic has provided the following data concerning the formulas used in its budgeting and its actual results for December: Data used in budgeting: Actual results for December: -The spending variance for medical supplies in December would be closest to:

Mandalay Hotel bases its budgets on guest-days. The hotel's static budget for August appears below: -The total cost at the activity level of 5,200 guest-days per month should be:

Wytch Corporation bases its budgets on machine-hours.The company's static planning budget for February appears below: Required: Prepare a flexible budget for 6,400 machine-hours per month.

-Herrod Catering uses two measures of activity,jobs and meals,in the cost formulas in its budgets and performance reports.The cost formula for catering supplies is $570 per month plus $98 per job plus $24 per meal.A typical job involves serving a number of meals to guests at a corporate function or at a host's home.The company expected its activity in December to be 11 jobs and 98 meals,but the actual activity was 14 jobs and 102 meals.The actual cost for catering supplies in December was $4,500.The spending variance for catering supplies in December would be closest to:

The activity variance for revenue is favorable if the actual revenue for the period exceeds the revenue in the static planning budget.

A favorable spending variance occurs when the actual cost is less than the amount of the cost in the static planning budget.

Standahl Air uses two measures of activity, flights and passengers, in the cost formulas in its budgets and performance reports. The cost formula for plane operating costs is $39,590 per month plus $2,649 per flight plus $4 per passenger. The company expected its activity in August to be 82 flights and 294 passengers, but the actual activity was 85 flights and 297 passengers. The actual cost for plane operating costs in August was $255,690. -The spending variance for plane operating costs in August would be closest to:

Bracken Clinic uses client-visits as its measure of activity. During September, the clinic budgeted for 2,100 client-visits, but its actual level of activity was 2,140 client-visits. The clinic has provided the following data concerning the formulas used in its budgeting and its actual results for September: Data used in budgeting: Actual results for September: -The revenue variance for September would be closest to:

Courington Detailing's cost formula for its materials and supplies is $2,420 per month plus $9 per vehicle. For the month of August, the company planned for activity of 63 vehicles, but the actual level of activity was 33 vehicles. The actual materials and supplies for the month was $2,840. Why such a great disparity between the planned and actual level of activity from 63 to 33 vehicles - should these be closer together? Please keep as is. -The materials and supplies in the flexible budget for August would be closest to:

Neighbors Kennel uses tenant-days as its measure of activity; an animal housed in the kennel for one day is counted as one tenant-day. During April, the kennel budgeted for 3,000 tenant-days, but its actual level of activity was 2,960 tenant-days. The kennel has provided the following data concerning the formulas used in its budgeting and its actual results for April: Data used in budgeting: Actual results for April: -The activity variance for net operating income in April would be closest to: