Kirnon Clinic uses client-visits as its measure of activity. During July, the clinic budgeted for 3,250 client-visits, but its actual level of activity was 3,160 client-visits. The clinic has provided the following data concerning the formulas to be used in its budgeting: Fixed element per month Variable element per client-visit Revenue $ 0 $ 39.10 Personnel expenses $ 35,100 $ 10.30 Medical supplies 1,100 7.10
Master Budget
A master budget can be defined as an estimation of the revenue earned or expenses incurred over a specified period of time in the future and it is generally prepared on a periodic basis which can be either monthly, quarterly, half-yearly, or annually. It helps a business, an organization, or even an individual to manage the money effectively. A budget also helps in monitoring the performance of the people in the organization and helps in better decision-making.
Sales Budget and Selling
A budget is a financial plan designed by an undertaking for a definite period in future which acts as a major contributor towards enhancing the financial success of the business undertaking. The budget generally takes into account both current and future income and expenses.
16.
Kirnon Clinic uses client-visits as its measure of activity. During July, the clinic budgeted for 3,250 client-visits, but its actual level of activity was 3,160 client-visits. The clinic has provided the following data concerning the formulas to be used in its budgeting:
| Fixed element per month | Variable element per client-visit | |
|---|---|---|
| Revenue | $ 0 | $ 39.10 |
| Personnel expenses | $ 35,100 | $ 10.30 |
| Medical supplies | 1,100 | 7.10 |
| Occupancy expenses | 8,100 | 1.10 |
| Administrative expenses | 5,100 | 0.20 |
| Total expenses | $ 49,400 | $ 18.70 |
The activity variance for net operating income in July would be closest to:
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$1,086 F
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$1,836 F
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$1,836 U
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$1,086 U
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