Question

Analytical Worksheet - Question #3 Budget vs Actual Worksheet 25 POINTS You are responsible for completing a budget for an Ambulatory Clinic. Here are the assumptions: INITIAL BUDGET a. The budget anticipated 40,000 inpatient days this year at an average of $750 per day. b. Inpatient expenses were budgeted at $650 per day. c. The budget anticipated 12,000 outpatient visits this year at an average of $475 revenue per visit. d. Outpatient expenses were budgeted at $420 per visit. ACTUAL RESULTS a. Assume that only 34,800 or 87% of the inpatient days are going to actually be achieved for the year. b. The average revenue of $750 per day will be achieved for these 34,800 inpatient days. c. The Outpatient visits will actually amount to 120% or 13,400 for the year. d. The average revenue of $475 per visit will be achieved for these 13,400 visits. e. Actual inpatient expenses will amount to $13,700,000 and actual outpatient expenses will amount to $4,620,000. REQUIRED: A. Prepare the budget and the actual on the attached worksheet. B. Complete a side by side comparison using your results from A above and complete the Static Variances in each category. Denreciation -

Answer 1

Budget vs Actual Statement Particulars 750 Inpatient Days Revenue/day Total Revenue(Days xRevenue per Day) Expenses Net Revenue index number Bugeted(s) Actual($) Variance Explanation (2-1) Inpatient varience $8.4 40000l 34800 Million is a favourable 750 varience because 3 = (1 x 2) 30000000 26100000 actual sales is more 26000000 13700000 than budgeted sales 5=(3-4) 5=(3-4) 4000000 12400000 8400000 Outpatient varience $1.08 Million is a 12000 13400 favourable varience 475 475 because actual sales is = (1 x 2) 5700000 6365000 more than budgeted 4 5040000 4620000 660000 1745000 1085000f Outpatient Days Revenue/day Total Revenue(Days x Revenue per Day) Expenses Net Revenue sales