Ruetz Clinic uses client-visits as its measure of activity.During November, the clinic budgeted for 2, 500 client-visits, but its actual level of activity was 2, 520 client-visits.The clinic has provided the following data concerning the formulas to be used in its budgeting: The occupancy expenses in the flexible budget for November would be closest to:
A)$11, 016
B)$11, 224
C)$11, 200
D)$11, 193

Question

Ruetz Clinic uses client-visits as its measure of activity.During November, the clinic budgeted for 2, 500 client-visits, but its actual level of activity was 2, 520 client-visits.The clinic has provided the following data concerning the formulas to be used in its budgeting:  The occupancy expenses in the flexible budget for November would be closest to:
A)$11, 016 
B)$11, 224 
C)$11, 200 
D)$11, 193

Quizplus · Accepted Answer

Cost = Fixed cost + (Variable cost per unit × q)
= $8, 200 + ($1.20 × 2, 520)= $11, 224

Ruetz Clinic Uses Client-Visits as Its Measure of Activity