1- Bartosiewicz Clinic uses client-visits as its measure of activity. During January, the clinic budgeted for 3,000 client-visits, but its actual level of activity was 2,980 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:

	Fixed element per month			Variable element per client-visit
Revenue		-		$	35.00
Personnel expenses	$	27,000		$	11.00
Medical supplies		1,000			5.00
Occupancy expenses		10,000			1.00
Administrative expenses		6,000			0.10
Total expenses	$	44,000		$	17.10

Actual results for January:

Revenue	$	124,650
Personnel expenses	$	72,000
Medical supplies	$	22,700
Occupancy expenses	$	14,600
Administrative expenses	$	8,105

The overall revenue and spending variance (i.e., the variance for net operating income in the revenue and spending variance column on the flexible budget performance report) for January would be closest to:

Multiple Choice

• $2,097 F

• $2,455 U

• $2,097 U

• $2,455 F

2-

Bramble Corporation is a small wholesaler of gourmet food products. Data regarding the store's operations follow:

• Sales are budgeted at $300,000 for November, $280,000 for December, and $270,000 for January.
• Collections are expected to be 65% in the month of sale and 35% in the month following the sale.
• The cost of goods sold is 70% of sales.
• The company would like to maintain ending merchandise inventories equal to 60% of the next month's cost of goods sold. Payment for merchandise is made in the month following the purchase.
• Other monthly expenses to be paid in cash are $23,600.
• Monthly depreciation is $14,600.
• Ignore taxes.

Balance Sheet October 31
Assets
Cash	$	21,600
Accounts receivable		71,600
Merchandise inventory		126,000
Property, plant and equipment, net of $573,600 accumulated depreciation		1,095,600
Total assets	$	1,314,800
Liabilities and Stockholders' Equity
Accounts payable	$	255,600
Common stock		821,600
Retained earnings		237,600
Total liabilities and stockholders' equity	$	1,314,800

The cost of December merchandise purchases would be:

Multiple Choice

• $210,000

• $113,400

• $191,800

• $196,000