Burget Clinic uses client-visits as its measure of activity. During July, the clinic budgeted for 2,100 client-visits, but its actual level of activity was 2,110 client-visits. The clinic has provided the following data concerning the formulas used in its budgeting and its actual results for July:
-The spending variance for medical supplies in July would be closest to:
A) $580 U
B) $645 U
C) $645 F
D) $580 F

Question

Burget Clinic uses client-visits as its measure of activity. During July, the clinic budgeted for 2,100 client-visits, but its actual level of activity was 2,110 client-visits. The clinic has provided the following data concerning the formulas used in its budgeting and its actual results for July: 
-The spending variance for medical supplies in July would be closest to:
A) $580 U 
B) $645 U 
C) $645 F 
D) $580 F

Quizplus · Accepted Answer

The spending variance is calculated as the difference between the actual cost and the budgeted cost. If the actual cost is higher than the budgeted cost, it results in an unfavorable (U) variance. The closest option indicating an unfavorable variance is $580 U.

Burget Clinic Uses Client-Visits as Its Measure of Activity