As the nurse manager of the new 15-bed observation unit, you are responsible for reporting to your nursing director and the finance department any variances identified within your operating budget. Listed below is your monthly operating report. Please review and discuss the specific variances and how you will determine the causes of variances. Actual Budget Variance Volume/Census 360 420 Supplies $8,550 $7,800 Nursing Labor $58,450 $52,575
Variance Analysis
In layman's terms, variance analysis is an analysis of a difference between planned and actual behavior. Variance analysis is mainly used by the companies to maintain a control over a business. After analyzing differences, companies find the reasons for the variance so that the necessary steps should be taken to correct that variance.
Standard Costing
The standard cost system is the expected cost per unit product manufactured and it helps in estimating the deviations and controlling them as well as fixing the selling price of the product. For example, it helps to plan the cost for the coming year on the various expenses.
- As the nurse manager of the new 15-bed observation unit, you are responsible for reporting to your nursing director and the finance department any variances identified within your operating budget. Listed below is your monthly operating report. Please review and discuss the specific variances and how you will determine the causes of variances.
|
|
Actual |
Budget |
Variance |
|
Volume/Census |
360 |
420 |
|
|
Supplies |
$8,550 |
$7,800 |
|
|
Nursing Labor |
$58,450 |
$52,575 |
|
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