The Fleming Medical Group financial results are under budget for the first six months of 2022. Using
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Question:
The Fleming Medical Group financial results are under budget for the first six months of 2022. Using the following table, calculate the volume, revenue, and cost variances for all variances greater than $5,000. What is the primary cause of the negative $40,186 net income variance? Explain the major cause behind the $54,936 increase in expenses.
YTD 2022 | YTD 2022 | |||
Description | Actual | Budget | $ Difference | % Difference |
Revenue | $2,964,750 | $2,950,000 | $14,750 | 0.5% |
Operating Expenses | ||||
Physician Salaries | $585,306 | $576,800 | $8,506 | 1.5% |
Nursing Salaries | 857,157 | 829,150 | 28,007 | 3.4% |
Mgt and clerical salaries | 466,971 | 468,650 | {1,679} | -0.4% |
FICA | 143,397 | 143,407 | {10} | 0.0% |
Health insurance | 238,760 | 234,325 | 4,435 | 1.9% |
Retirement | 76,763 | 74,984 | 1,779 | 2.4% |
Unemployment | 18,323 | 18,746 | {423} | -2.3% |
Medications | 91,687 | 89,015 | 2,672 | 3.0% |
Medical instruments | 64,287 | 61,761 | 2,526 | 4.1% |
Bandaged, gauze | 34,140 | 34,529 | {389} | -1.1% |
Gloves, gowns | 24,476 | 24,283 | 193 | 0.8% |
Sterile wipes | 15,780 | 16,114 | {334} | -2.1% |
Office supplies | 69,388 | 69,216 | 172 | 0.2% |
Cleaning supplies | 23,103 | 23,461 | {358} | -1.5% |
Rent | 89,251 | 86,520 | 2,731 | 3.2% |
Maintenance | 11,245 | 8,270 | 2,975 | 36.9% |
Electricity | 6,684 | 6,482 | 202 | 3.1% |
Gas | 11,215 | 11,118 | 97 | 0.9% |
Water and sewage | 4,225 | 4,059 | 166 | 4.1% |
Telephone | 2,004 | 1,939 | 65 | 3.4% |
Housekeeping | 21,694 | 21,630 | 64 | 0.3% |
Travel/meetings/meals | 4,744 | 4,751 | {7} | -0.1% |
Prof insurance | 15,669 | 13,447 | 2,222 | 16.5% |
CME | 17,994 | 17,938 | 56 | 0.3% |
Other expenses | 35,955 | 34,687 | 1,268 | 3.7% |
$2,930,218 | $2,875,282 | $54,936 | 1.9% | |
Net income | $34,532 | $74,718 | {$40,186} | -53.8% |
Profit margin | 1.16% | 2.53% | ||
Output | Actual | Budget | Difference | %Difference |
Visits | 15,451 | 15,408 | 43 | 0.3% |
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