Instructions:

The following are budgeted and actual revenues and expenses for a hospital. USE ATTACHED TEMPLATE PLEASE!!!!!

Budgeted Actual

Revenues

Surgical Volume 2,300 2,600

Gift Shop Revenues $18,000 $19,000

Surgery Revenues $589,500 $852,750

Parking Revenues $17,000 $19,000

Expenses

Patients Days 26,000 25,000

Pharmacy $119,000 $158,000

Misc Supplies $68,000 $795,600

Fixed Overhead Costs $832,000 $890,000

Determine the total variance between the planned and actual budgets for Surgical Volume. Is the variance favorable or unfavorable?

Determine the total variance between the planned and actual budgets for Patient Days. Is the variance favorable or unfavorable?

Determine the service-related variance for Surgical Volume.

Determine the service-related variance for Patient Days.

Prepare a flexible budget estimate. Present a side-by-side budget, flexible budget estimate, and the actual Surgical Revenues.

Prepare a flexible budget estimate. Present a side-by-side budget, flexible budget estimate, and the actual Patient Expenses.

Determine what variances are due to change in volume and what variances are due to change in rates.

	Revenues
		Givens:		Budgeted		Actual
	A	Surgical volume
	B	Gift shop revenues
	C	Surgery revenues
	D	Parking revenues
								Variance		Fav or Unfav
	1. Total variance between the planned and actual budgets.
	E	Surgical volume	[A]
	F	Gift shop revenues	[B]
	G	Surgery revenues	[C]
	H	Parking revenues	[D]
	I	Total variance	[B+C+D]
	3. Service-related revenues and variance still unexplained.
	J	Total variance	[I]
	K	Gift shop revenue variance	[F]
	L	Parking revenue variance	[H]
	M	Unexplained service-related variance	[J-K-L]
	5. Prepare a flexible budget estimate.			Budgeted		Flexible		Actual
	N	Surgical volume	[A]
	O	Surgical revenue per unit	[C / A]
	P	Surgical revenue	[C]
	7. Variances are due to volume and due to rate.									Variance
	Q	Budgeted surgical revenue	[P]
	R	Flexible surgical revenue	[P]
	S	Actual surgical revenue	[P]
	T	Volume variance	[R - Q]
	U	Rate variance	[S - R]

Expenses
	Givens:		Budgeted		Actual
A	Patient days
B	Pharmacy
C	Miscellaneous supplies
D	Fixed overhead costs
							Variance		Fav or Unfav
2. Total variance between the planned and actual budgets.
E	Patient days	[A]
F	Pharmacy	[B]
G	Miscellaneous supplies	[C]
H	Fixed overhead costs	[D]
I	Total variance	[B+C+D]
4. Service related costs and variance still unexplained.
J	Total variance	[I]
K	Amt. explained by fixed overhead	[H]
L	Other fixed expenses
M	Service-related variance	[J-K-L]
6. Prepare a flexible budget estimate.			Budgeted		Flexible		Actual
N	Patient days	[A]
O	Cost per patient day (Pharm + Misc)	[B+C]/[A]
P	Total cost (Pharm+Misc)	[N x O]