Exam 9: Flexible Budgets and Performance Analysis

Buonocore Clinic uses client-visits as its measure of activity.During August, the clinic budgeted for 2, 800 client-visits, but its actual level of activity was 2, 770 client-visits.The clinic has provided the following data concerning the formulas used in its budgeting and its actual results for August: Data used in budgeting: Actual results for August: The revenue variance for August would be closest to:

During August, Kociolek Clinic plans for an activity level of 2, 800 patient-visits.The clinic uses the following revenue and cost formulas in its budgeting, where q is the number of patient-visits: Revenue: $28.20q Personnel expenses: $22, 200 + $7.60q Medical supplies: $1, 100 + $5.20q Occupancy expenses: $5, 100 + $1.00q Administrative expenses: $3, 200 + $0.40q Required: Prepare the clinic's planning budget for August.

Zike Corporation's static planning budget for October appears below.The company bases its budgets on machine-hours. In October, the actual number of machine-hours was 6, 000, the actual supplies cost was $14, 740, the actual power cost was $49, 170, the actual salaries cost was $15, 390, and the actual equipment depreciation was $63, 670. The spending variance for power cost in the flexible budget performance report for the month should be:

Stitt Corporation manufactures and sells a single product.The company uses units as the measure of activity in its budgets and performance reports.During November, the company budgeted for 5, 900 units, but its actual level of activity was 5, 880 units.The company 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 direct labor in the planning budget for November would be closest to:

Miao Clinic uses client-visits as its measure of activity.During July, the clinic budgeted for 3, 000 client-visits, but its actual level of activity was 2, 980 client-visits.The clinic has provided the following data concerning the formulas used in its budgeting and its actual results for July: Data used in budgeting: Actual results for July: The administrative expenses in the planning budget for July would be closest to:

Drey Jeep Tours operates jeep tours in the heart of the Colorado Rockies.The company bases its budgets on two measures of activity (i.e. , cost drivers), namely guests and jeeps.One vehicle used in one tour on one day counts as a jeep.Each jeep has one tour guide.The company uses the following data in its budgeting: In July, the company budgeted for 399 guests and 127 jeeps.The actual activity for the month was 419 guests and 123 jeeps. Required: Prepare a report showing the company's activity variances for July.Label each variance as favorable (F)or unfavorable (U).

Hairston Corporation manufactures and sells a single product.The company uses units as the measure of activity in its budgets and performance reports.During November, the company budgeted for 7, 700 units, but its actual level of activity was 7, 720 units.The company 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 spending variance for direct materials in November would be closest to:

Buonocore Clinic uses client-visits as its measure of activity.During August, the clinic budgeted for 2, 800 client-visits, but its actual level of activity was 2, 770 client-visits.The clinic has provided the following data concerning the formulas used in its budgeting and its actual results for August: Data used in budgeting: Actual results for August: The personnel expenses in the planning budget for August would be closest to:

Febbo Clinic bases its budgets on the activity measure patient-visits.During February, the clinic planned for 3, 200 patient-visits, but its actual level of activity was 3, 000 patient-visits.Revenue should be $54.00 per patient-visit.Personnel expenses should be $39, 400 per month plus $16.70 per patient-visit.Medical supplies should be $1, 300 per month plus $10.90 per patient-visit.Occupancy expenses should be $11, 600 per month plus $2.00 per patient-visit.Administrative expenses should be $5, 400 per month plus $0.30 per patient-visit. Required: Prepare a report showing the clinic's activity variances for February.Indicate in each case whether the variance is favorable (F)or unfavorable (U).

Bobe 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 $44, 580 per month plus $2, 390 per flight plus $8 per passenger.The company expected its activity in May to be 68 flights and 211 passengers, but the actual activity was 71 flights and 210 passengers.The actual cost for plane operating costs in May was $215, 140. The plane operating costs in the planning budget for May would be closest to:

Ruetz Clinic uses client-visits as its measure of activity.During November, the clinic budgeted for 2, 500 client-visits, but its actual level of activity was 2, 520 client-visits.The clinic has provided the following data concerning the formulas to be used in its budgeting: The net operating income in the flexible budget for November would be closest to:

The revenue and spending variances are the differences between the flexible budget and the actual results for the period.

Blaney Jeep Tours operates jeep tours in the heart of the Colorado Rockies.The company bases its budgets on two measures of activity (i.e. , cost drivers), namely guests and jeeps.One vehicle used in one tour on one day counts as a jeep.Each jeep has one tour guide.The company uses the following data in its budgeting: In October, the company budgeted for 456 guests and 115 jeeps.The actual activity for the month was 446 guests and 111 jeeps. Required: Prepare the company's flexible budget for the actual level of activity in October.

Fortmann 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 September, the kennel budgeted for 2, 000 tenant-days, but its actual level of activity was 2, 010 tenant-days.The kennel has provided the following data concerning the formulas to be used in its budgeting: The activity variance for net operating income in September would be closest to:

Hairston Corporation manufactures and sells a single product.The company uses units as the measure of activity in its budgets and performance reports.During November, the company budgeted for 7, 700 units, but its actual level of activity was 7, 720 units.The company 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 direct materials in the flexible budget for November would be closest to:

Biggs Enterprise's flexible budget cost formula for indirect materials, a variable cost, is $0.60 per unit of output.If the company's performance report for last month shows a $200 favorable spending variance for indirect materials and if 9, 000 units of output were produced last month, then the actual costs incurred for indirect materials for the month must have been:

Smithj 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 February, the kennel budgeted for 3, 500 tenant-days, but its actual level of activity was 3, 490 tenant-days.The kennel has provided the following data concerning the formulas used in its budgeting and its actual results for February: Data used in budgeting: Actual results for February: The spending variance for food and supplies in February would be closest to:

Cruea Tech is a for-profit vocational school.The school bases its budgets on two measures of activity (i.e. , cost drivers), namely student and course.The school uses the following data in its budgeting: In November, the school budgeted for 1, 410 students and 138 courses.The actual activity for the month was 1, 810 students and 139 courses. Required: Prepare the school's planning budget for November.

Ruetz Clinic uses client-visits as its measure of activity.During November, the clinic budgeted for 2, 500 client-visits, but its actual level of activity was 2, 520 client-visits.The clinic has provided the following data concerning the formulas to be used in its budgeting: The medical supplies in the flexible budget for November would be closest to:

Wesolick Clinic uses client-visits as its measure of activity.During August, the clinic budgeted for 2, 900 client-visits, but its actual level of activity was 2, 870 client-visits.The clinic has provided the following data concerning the formulas used in its budgeting and its actual results for August: Data used in budgeting: Actual results for August: The activity variance for personnel expenses in August would be closest to: