The urgent care manager must resubmit her budget based on

The urgent care manager must resubmit her budget based on 2018 projected visits. The 2018 budget should be based on actual expenses and visits incurred during the first seven months of 2017. Cost standards (2017) and budget standards (2018) must be prepared for all variable costs (indicated by a V behind the object code description). All fixed costs (F) should be projected using the incremental budgeting methodology. Projected visits is 2018 is 52,560. Salary and fringe benefit (object codes 4000-4199) increases for all personnel should be estimated at 4.0% except for health insurance (4120) which is expected to increase by 8%. Input price increases for supplies and other costs (4200-4960) should be increased by 3% except for medications, 5% increase and profession insurance, 10%. All increases are effective January 1, 2015. The budget report, BudgetCh06, Problem 6.1 tab, shows the urgent care centers expenses for 2016 and the actual and budgeted expenses for the first seven months of 2017. The CEO has requested all department heads submit their 2015 operating budget by Wednesday, March 21, 2014. The 2018 fiscal year begins January 1, 2018.

Total Visits
51,986
30,331
30,672
52,560






Obj.Code
Description
2016
Actual 2017
Budget 2017
Budget 2018
4010
Physician salaries – V
$960,000
$585,306
$576,800
________
4020
Nursing staff salaries – V
1,380,000
857,157
829,150
________
4030
Management & clerical salaries – F
780,000
466,971
468,650
________
4110
FICA – F
238,680
143,397
143,407
________
4120
Health Insurance – F
390,000
238,760
234,325
________
4130
Retirement – F
124,800
76,763
74,984
________
4140
Unemployment – F
31,200
18,323
18,746
________
4211
Medications – V
148,152
91,687
89,015
________
4212
Medical instruments - V
102,792
64,287
61,761
________
4214
Bandages, gauze… - V
57,468
34,140
34,529
________
4216
Latex gloves, gowns… - V
40,416
24,476
24,283
________
4216
Sterile wipes – V
26,820
15,780
16,114
________
4250
Office supplies – V
115,200
69,388
69,216
________
4280
Cleaning supplies – V
39,048
23,103
23,461
________
4310
Rent – F
144,000
89,251
86,520
________
4350
Maintenance – F
13,764
11,245
8,270
________
4410
Electricity – F
10,788
6,684
6,482
________
4420
Gas – F
18,504
11,215
11,118
________
4430
Water and Sewage – F
6,756
4,225
4,059
________
4440
Telephone – F
3,228
2,004
1,939
________
4930
Housekeeping – F
36,000
21,694
21,630
________
4940
Travel/professional meetings/meals – F
7,908
4,744
4,751
________
4945
Professional Insurance – F
22,380
15,669
13,447
________
4950
CME – F
29,856
17,994
17,938
________
4960
Other expenses - F
57,732
35,955
34,687
________


$4,785,492
$2,930,217
$2,875,283
________

A. Compare and contrast the incremental budget (prepared in homework 4) and the flexible budget.

B. Assume 2015 has been completed and actual output is 53,011, restate (or flex) the budget, what is the final budget the manager will be accountable to?

C. Assume 2015 has been completed and actual output is 51,543, restate the budget what is the final budget the manager will be accountable to?



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