# Accounting

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Analyze the variances in the following scenario:

You are the nursing administrator for a medical group that expects a severe
outbreak of the flu this winter.  You hire additional staff to treat the
patients and administer shots.  Your special project budget was for 1,000 hours
of part-time nurses’ services at \$40 per hour, for a total cost of \$40,000.  It
was expected that these nurses would administer 400 flu shots and treat 1,600
flu patients.  The medical group typically charges \$50 for a flu shot and \$80
for treating a flu patient. Actually, the group had 1,200 patients who received
the flu shot and 1,400 who had the flu and received treatment.  On average, it
was able to collect \$55 per flu shot and \$70 per flu patient.

Compute the volume, mix, and price revenue variances.  How did things turn
out for the group considering just revenues?  How did they turn out from a
profit perspective? Use either the approach from chapter 8 or from Appendix 8-A
to solve.  Clearly label the calculations of the required variances using
Excel.  Use formulas to calculate the three variances and format the cells to
insert a comma if there is more than three numbers and round to the nearest
whole number.  Explain the meaning of the variances in a two page Word
document.