Tennies Clinic uses client-visits as its measure of activity. During November, the clinic budgeted for 3,300 client-visits, but its actual level of activity was 3,290 client-visits. The clinic has provided the following data concerning the formulas used in its budgeting and its actual results for November: Data used in budgeting: Fixed element per month Variable element per client-visit Revenue $35.40 Personnel expenses $29,500 $10.40 Medical supplies 1,200 5.80 Occupancy expenses 7,600 1.90 Administrative expenses 5,900 .30 Total expenses $44,200 $18.40 Actual results for November: Revenue $116,656 Personnel expenses $63,686 Medical supplies $21,072 Occupancy expenses $13,371 Administrative expenses $6,677 The spending variance for medical supplies in November would be closest to_____________.

Respuesta :

$790 is spending varinace

Explanation:

The following calculation is made to find out the variance in spending.

Flexible budget [tex](\$ 1,200+\$ 5.80 * 3,290)[/tex] = $20,282

Actual results = $21,072

Spending variance = $790

Because the actual expense is greater than the flexible budget; the variance is un-favorable (U).

Thus, from the above calculation, the spending difference is $790 which is not favourable

Note: the spending variance is calculated by comparing the flexible budget with the actual results. The term variance means the difference has to be calculated.