6.3 Refer to Carroll Clinics 2012 operating budget, contained in Exhibit 6.2. instead of the actual results reported in Exhibit 6.3. Assume the results are reported below:

I. Volume (Number of Visits)	Payer A 11,000 Payer B 12,000 Total 23,000
II. Reimbursement (per Visit)	Payer A $95 Payer B $95
III. Costs	Variable Costs: Supplies $350,000	Fixed Costs: Labor $1,000,000 Overhead $500,000 Total $1,500,000
IV. Forecasted P&L Statement	Revenues: Payer A $1,045,000 Payer B $1,140,000 Total Revenues $2,185,000	Variable Costs $350,000 Fixed Costs $1,500,000 Total $1,850,000	Profit $335,000

a. What are the profit, revenue, and cost variances based on the simple (Exhibit 6.2) budget?

b. Construct Carrolls flexible budget for 2012.

c. What are the profit, revenue, and cost variances based on the flexible budget?

d. Interpret your results. In particular, focus on the differences between the variance analysis here and the Carroll Clinic illustration presented in the chapter

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Please Show Work.