. ZZ Health Care Clinic uses client-visits as its measure of activity. During Quarter 1, 2020, the clinic budgeted for 2,600 client-visits, but its actual level of activity was 2,570. The clinic has provided the following data concerning the formulas used in its budgeting and its actual results for Quarter 1, 2020:

	Fixed element per quarter (RM)	Variable element per client visit (RM)
Revenue		51,50
Personnel ex enses	42,700	17.20
Medical su lies	27,500	6.80
Occu anc ex enses	22,000	1.80
Administrative ex enses	4,700	0.20
De reciation	2,000

Actual result in Quarter 1, 2020.

Revenue		RM 132,300
Personnel ex enses		RM 78,800
Medical su	lies	RM 29,153
Occu anc ex enses		RM 24,432
Administrative ex enses		RM 5,040
De reciation		RM 2,000

Required:

i. Prepare a performance report for Quarter 1, 2020. (12 marks)

ii. Using the performance report you prepared (required i), evaluate the performance of the clinic in Quarter 1, 2020. (4 marks)

b. Damak Holdings produces a special box called Max. The company has recently created a standard cost system to help control costs and has established the following standards for Max box:

Direct materials; 6 kg per box at RM 10.50 per kg

Direct labour: 3.3 hours per box at RM 31 per hour

During July, the company produced 3,000 Max. The box's production data for the month

as follows:

Direct materials purchased: 25,000 kg @ RM 10.20 per kg

Direct materials balance: 5,000 of kg,

Direct labour hours worked: 4,000 direct labour hours @ RM 288,000.

Required:

i. Compute the material price variance for July, ii. Compute the material quantity variance for July.

(3 marks) (3 marks)

iii. Prepare a brief explanation of the possible causes of each variance. (3 marks)