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F. Naz
F. Naz, Chartered Accountant
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consider the following 2007 data for Newark General Hospital(in

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consider the following 2007 data for Newark General Hospital(in million of dollars):

REVENUES-$4.7 $ 4.8 $ 4.5
COSTS 4.1 4.1 4.2
PROFITS 0.6 0.7 0.3

A) calculate and interpret the profit variance.
B) calculate and interpret the revenue variance.
C) calculate and interpret the cost variance.
D) calculate and interpret thevolume and management variances on the cost side.
E) calculate and interpret thevolume and price variances on the revenue side.
F)how are the variances calculated above related?
8.2 Here are the 2007 revenues for the Wendover Group Practice Association for four different budgets, in thousands of dollars:

static budget $425, Flexible(enrollment/utilization)budget $200, flexible(enrollment)budget $180, Actual results $300

a. What does the budget data tell you about the nature of Wendover’s patients: Are they capitated or fee-for-service?
b. Calculate and interpret the following variances:
o Revenue variance
o Volume variance
o Price variance
o Enrollment variance
o Utilization variance

8.3 Here are the budgets of Brandon Surgery Center for the most recent historical quarter, in thousands of dollars:
number of surgeries 1,200
patient revenue $2,400
salary 1,200
non-salary expense600
profit $600
number of surgeries 1,300
patient revenue $2,600
salary 1,300
non-salary expense650
profit $650
number of surgeries 1,300
patient revenue $2,535
salary 1,365
non-salary expense 585
profit $585

The center assumes that all revenues and costs are variable and hence tied directly to patient volume.
a. Explain how each amount in the flexible budget was calculated. (Hint: Examine the static budget to determine the relationship of each budget line to volume.)
b. Determine the variances for each line of the profit and loss statement, both in dollar terms and in percentage terms. (Hint: Each line has a total variance, a volume variance, and a management variance.)
c. What do the Part b results tell Brandon’s managers about the surgery center’s operations for the quarter?
By what time do you need the answer thanks.
Customer: replied 4 years ago.

By Sunday

Okay will try my best to answer it by your deadline, take care.
Customer: replied 4 years ago.


You are welocme, take care.

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