Healthcare Financial Management and Economics
Assignment- Budgeting and Variance Analysis
Instructions:
The following are budgeted and actual revenues and expenses for a hospital.
|
Budgeted
|
Actual
|
|
Revenues
|
|
|
Surgical Volume
|
2,500
|
2,700
|
|
Gift Shop Revenues
|
$19,000
|
$20,000
|
|
Surgery Revenues
|
$600,500
|
$850,750
|
|
Parking Revenues
|
$16,000
|
$18,000
|
|
Expenses
|
|
|
Patients Days
|
27,000
|
27,000
|
|
Pharmacy
|
$120,000
|
$160,000
|
|
Misc Supplies
|
$66,000
|
$77,500
|
|
Fixed Overhead Costs
|
$808,000
|
$880,000
|
Using an Excel spreadsheet to show your calculations:
1. Determine the total variance between the planned and actual budgets for Surgical Volume. Is the variance favorable or unfavorable?
2. Determine the total variance between the planned and actual budgets for Patient Days. Is the variance favorable or unfavorable?
3. Determine the service-related variance for Surgical Volume.
4. Determine the service-related variance for Patient Days.
5. Prepare a flexible budget estimate. Present aside-by-side budget, flexible budget estimate, and the actual Surgical Revenues.
6. Prepare a flexible budget estimate. Present aside-by-side budget, flexible budget estimate, and the actual Patient Expenses.
7. Determine what variances are due to change in volume and what variances are due to change in rates.
Attachment:- Template.xlsx