Guareno Clinic uses client-visits as its measure of activity. During December, the clinic budgeted for 2,500 client-visits, but its actual level of activity was 2,450 client-visits. The clinic has provided the following data concerning the formulas used in its budgeting and its actual results for December:
Data used in budgeting:
Actual results for December:

-The spending variance for medical supplies in December would be closest to:
A) $720 F
B) $450 U
C) $720 U
D) $450 F

Question

Guareno Clinic uses client-visits as its measure of activity. During December, the clinic budgeted for 2,500 client-visits, but its actual level of activity was 2,450 client-visits. The clinic has provided the following data concerning the formulas used in its budgeting and its actual results for December:
Data used in budgeting:
  Actual results for December:
 
-The spending variance for medical supplies in December would be closest to:
A) $720 F 
B) $450 U 
C) $720 U 
D) $450 F

Quizplus · Accepted Answer

11ea7761_1773_0b73_81a5_4de011147062_TB2580_00 Because the actual expense is less than the flexible budget, the variance is favorable (F).

Guareno Clinic Uses Client-Visits as Its Measure of Activity