Federick Clinic Uses Client-Visits as Its Measure of Activity

question 245

Multiple Choice

Federick Clinic uses client-visits as its measure of activity. During October, the clinic budgeted for 3,000 client-visits, but its actual level of activity was 3,040 client-visits. The clinic has provided the following data concerning the formulas used in its budgeting and its actual results for October: Data used in budgeting: Actual results for October: The spending variance for occupancy expenses in October would be closest to:

• A)$848 U
• B)$780 U
• C)$848 F
• D)$780 F

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Definitions:

Undervalued Patent

A patent that is recognized at a market value lower than its potential earning power or its replacement cost.

Partial Equity Method

A method of accounting for an investment, where the investor recognizes its share of the investee's profits but not its losses to the extent of the investment's carrying amount.

Investment Account

An account held at a financial institution that contains securities, cash, and other assets held for investment purposes.

Investment Accounting Method

A set of principles for recording investments on the financial statements, depending on the level of control or influence over the invested entity.