Monard Clinic uses client-visits as its measure of activity. During January, the clinic budgeted for 3,700 client-visits, but its actual level of activity was 3,710 client-visits. The clinic has provided the following data concerning the formulas used in its budgeting and its actual results for January:

Data used in budgeting:

Actual results for January:

-The activity variance for personnel expenses in January would be closest to:
A)$66 U
B)$66 F
C)$2,256 F
D)$2,256 U

Question

Monard Clinic uses client-visits as its measure of activity. During January, the clinic budgeted for 3,700 client-visits, but its actual level of activity was 3,710 client-visits. The clinic has provided the following data concerning the formulas used in its budgeting and its actual results for January:

Data used in budgeting:

Actual results for January:

-The activity variance for personnel expenses in January would be closest to:

Data used in budgeting:

Actual results for January:

-The activity variance for personnel expenses in January would be closest to:
A)$66 U 
B)$66 F 
C)$2,256 F 
D)$2,256 U

Quizplus · Accepted Answer

The activity variance is calculated as the difference between the flexible budget and the static budget. A $66 unfavorable (U) variance indicates that the actual expenses were $66 more than the budgeted amount.

Monard Clinic Uses Client-Visits as Its Measure of Activity