Gourley Clinic uses client-visits as its measure of activity. During August, the clinic budgeted for 3,500 client-visits, but its actual level of activity was 3,410 client-visits. The clinic has provided the following data concerning the formulas to be used in its budgeting:
|
Fixed element per month |
Variable element per client-visit |
| Revenue |
- |
$39.60 |
|
|
|
| Personnel expenses |
$35,600 |
$10.80 |
| Medical supplies |
1,600 |
7.60 |
| Occupancy expenses |
8,600 |
1.60 |
| Administrative expenses |
5,600 |
0.7 |
| Total expenses |
$51,400
|
$20.70
|
The activity variance for administrative expenses in August would be closest to:
|
$63 F |
|
$123 F |
|
$63 U |
|
$123 U
|
| Hurren Corporation makes a product with the following standard costs: |
| Inputs |
Standard Quantity or Hours |
Standard Price or Rate |
Standard Cost PerUnit |
| Direct materials |
5.1 grams |
$5.00 per gram |
$25.50 |
| Direct labor |
1.4 hours |
$16.00 per hour |
$22.40 |
| Variable overhead |
1.4 hours |
$5.00 per hour |
$7.00 |
| The company reported the following results concerning this product in June. |
| Originallybudgetedoutput |
6,000 |
units |
| Actual output |
5,900 |
units |
| Raw materials used in production |
28,450 |
grams |
| Actual direct labor-hours |
5,200 |
hours |
| Purchases of raw materials |
32,500 |
grams |
| Actual price of raw materials purchased |
$5.10 |
per gram |
| Actual direct labor rate |
$16.90 |
per hour |
| Actual variable overhead rate |
$4.70 |
per hour |
|
The company applies variable overhead on the basis of direct labor-hours. The direct materials price variance is computed when the materials are purchased.
|
| The materials quantity variance for June is: |
|
$8,364 F |
|
$8,364 U |
|
$8,200 U |
|
$8,200 F |