Gourley clinic uses client-visits as its measure of

Reference no: EM13570543

Gourley Clinic uses client-visits as its measure of activity. During August, the clinic budgeted for 3,500 client-visits, but its actual level of activity was 3,410 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	-	$39.60

Personnel expenses	$35,600	$10.80
Medical supplies	1,600	7.60
Occupancy expenses	8,600	1.60
Administrative expenses	5,600	0.7
Total expenses	$51,400	$20.70

The activity variance for administrative expenses in August would be closest to:

	$63 F
	$123 F
	$63 U
	$123 U

Hurren Corporation makes a product with the following standard costs:

Inputs	Standard Quantity or Hours	Standard Price or Rate	Standard Cost PerUnit
Direct materials	5.1 grams	$5.00 per gram	$25.50
Direct labor	1.4 hours	$16.00 per hour	$22.40
Variable overhead	1.4 hours	$5.00 per hour	$7.00

The company reported the following results concerning this product in June.

Originallybudgetedoutput	6,000	units
Actual output	5,900	units
Raw materials used in production	28,450	grams
Actual direct labor-hours	5,200	hours
Purchases of raw materials	32,500	grams
Actual price of raw materials purchased	$5.10	per gram
Actual direct labor rate	$16.90	per hour
Actual variable overhead rate	$4.70	per hour

The company applies variable overhead on the basis of direct labor-hours. The direct materials price variance is computed when the materials are purchased.

The materials quantity variance for June is:

	$8,364 F
	$8,364 U
	$8,200 U
	$8,200 F

Reference no: EM13570543

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