Chelsea Clinic projected the following budget information for 2020:

a. Construct Chelsea Clinic’s operating budget for 2020.

b. Discuss how each key budget assumption might result in a budget variance, and name the variance that would be used to examine results associated with each assumption.

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Total FFS Visit Volume Payer Mix: Blue Cross Highmark Reimbursement Rates: Blue Cross Highmark Variable Costs Resource Inputs: Labor 90,000 visits 40% 60% $25 per visit $20 per visit 48,000 total hours Supplies 100,000 total units Resource Input Prices: Labor $25.00 per hour Supplies Fixed Costs (overhead, plant, and equipment) $1.50 per unit $500,000