Rocky Mountain General Hospital serves three counties in Colorado. The hospital is a nonprofit organization that is supported by patient billings, county and state funds, and private donations. The hospital's organization is shown in the following chart.

The following cost information has been compiled for August.
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Required:
1. Prepare a set of cost performance reports similar to Exhibit 12-4 . The report should have six columns, as in Exhibit 12-4 . The first four columns will have the same headings as those used above. The last two columns will have the following headings: Variance-August, Variance-Year to Date. Since all of the information in the performance reports for Rocky Mountain General Hospital is cost information, you do not need to show these data in parentheses. Use F or U to denote whether each variance in the reports is favorable or unfavorable.
2. Using arrows, show the relationships between the numbers in your performance reports for Rocky Mountain General Hospital. Refer to Exhibit 12-4 for guidance.
3. Put yourself in the place of the hospital's administrator. Which August variances in the performance reports would you want to investigate further? Why?

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Rocky Mountain General Hospital General Medicine Division Surgical Division Medical Support DIvISIOn Administrative Division Radiology and Laboratory Department Nursing Department Nutrition Department Housekeeping Department Maintenance Department Registered Dietitians Section Kitchen Food Service Section Patient Food Service Cafeteria Budget Actual August Year to Date August Year to Date Cafeteria: $ 8,000 64,000 36,000 8,000 3,200 8,800 9,600 136,000 60,000 248,000 560,000 144,000 80,000 104,000 1,680,000 1,120,000 400,000 $ 9,000 72,000 36,200 8,100 1,100 8,600 9,600 137,000 60,000 246,000 580,000 144,000 86,000 77,000 1,670,900 1,115,800 406,000 Food servers' wages 4,400 1,050 Paper products 4,500 1,000 Utilities Maintenance 1,100 1,200 17,000 7,500 31,000 70,000 18,000 10,000 13,000 210,000 140,000 50,000 Custodial Supplies Patient Food Service Registered Dietitians' Section Kitchen Nursing Department Radiology and Laboratory Department Housekeeping Department Maintenance Department General Medicine Division Surgical Division Administrative Division 18,500 7,500 29,400 75,000 18,100 11,600 6,000 204,000 141,000 53,500