Weisgarber Clinic uses client-visits as its measure of activity. During August, the clinic budgeted for 3,900 client-visits, but its actual level of activity was 3,850 client-visits. The clinic has provided the following data concerning the formulas to be used in its budgeting for August:
-The personnel expenses in the planning budget for August would be closest to:
A) $83,940
B) $88,444
C) $83,310
D) $87,310

Question

Weisgarber Clinic uses client-visits as its measure of activity. During August, the clinic budgeted for 3,900 client-visits, but its actual level of activity was 3,850 client-visits. The clinic has provided the following data concerning the formulas to be used in its budgeting for August: 
-The personnel expenses in the planning budget for August would be closest to:
A) $83,940 
B) $88,444 
C) $83,310 
D) $87,310

Quizplus · Accepted Answer

Personnel expenses = Fixed portion + Variable portion
Fixed portion = Salary + Rent + Utilities = $59,250
Variable portion = Hourly rate x Hours worked = $20 x (# of visits)
Flexible budget for personnel expenses:
$59,250 + ($20 x 3,850) = $83,940

Therefore, the closest answer choice is A) $83,940.

Weisgarber Clinic Uses Client-Visits as Its Measure of Activity