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 medical supplies in the flexible budget for February would be closest to:
A) $17,512
B) $17,204
C) $18,087
D) $18,240

Question

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 medical supplies in the flexible budget for February would be closest to:
A) $17,512 
B) $17,204 
C) $18,087 
D) $18,240

Quizplus · Accepted Answer

Cost = Fixed cost + (Variable cost per unit × q)
= $900 + ($5.10 × 3,370) = $18,087

Spohn Clinic Uses Client-Visits as Its Measure of Activity