Case Study #2



Case Study #2

Answer 1

This budget variance evaluates whether the differences among the actual and static budget amounts are favorable that is profits increased or unfavorable that is decrease in profits. The budgeted amounts are less than the actual expense, which shows that in expenses Salary expense was unfavorable (U). However, there was no change in the other two expenses. The revenues earned were more than the budgeted ones because of more number of Colonoscopies hence; it was favorable (F).

Answer 2

Contribution Margin = Price - VC (Variable Cost)

Contribution Margin = $ 287 - $ 97

CM ratio = 190 / ...