# Healthcare Finance Accounting Question - Appomattox Nursing Home _Budget and Variances

Question # 00004255 Posted By: ACCOUNTS_GURU Updated on: 11/29/2013 08:16 AM Due on: 12/31/2013
Subject Accounting Topic Accounting Tutorials:
Question

The administrator of Appomattox Nursing Home is very aware of needing to keep his cost down since he just negotiated a new arrangement with a large insurance company that will pay him a fixed amount per patient day. Listed below are budgeted and actual expenses for the previous month.

Actual patient days were 30,000 compared to budgeted patient days of 24,000.

 Budgeted Costs @ 24,000 Patient Days Budgeted Cost Per Unit Actual Costs @ 30,000 Patient Days Pharmacy Costs Variable \$100,000 \$4.167 \$140,000 Misc Supplies Costs Variable \$56,000 \$2.333 \$67,500 Fixed Overhead Costs \$708,000 \$29.50 \$780,000 Total \$864,0000 \$36.00 \$987,500

a. Determine the total variance associated with the planned and actual expenses.

b. Prepare a flexible budget of expense at 30,000 patient days.

c. Determine the “Spending Variance” which is defined as Actual costs less costs budgeted at actual volume.

Tutorials for this Question
1. ## Solution: Healthcare Finance Accounting Question - Appomattox Nursing Home _Budget and Variances

Tutorial # 00004052 Posted By: ACCOUNTS_GURU Posted on: 11/29/2013 08:17 AM
Puchased By: 2
Tutorial Preview
Fixed Overhead Costs \$708,000 \$29.50 \$780,000 Total \$864,0000 \$36.00 \$987,500 a. ...
Attachments
Appomattox_Nursing_Home__Budget_and_Variances.xlsx (12.58 KB)

Great! We have found the solution of this question!