HEALTHCARE FINANCE ACCOUNTING QUESTION.The administrator of Appomattox Nursing Home is very aware of needing to keep his cost down since he just negotiated a new arrangement with a large insurance company that will pay him a fixed amount per patient day.

HEALTHCARE FINANCE ACCOUNTING QUESTION.The administrator of Appomattox Nursing Home is very aware of needing to keep his cost down since he just negotiated a new arrangement with a large insurance company that will pay him a fixed amount per patient day.

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Video Link – http://www.umfk.edu/de/jpelletier/hca321/module12.htm If video does not open please download Quicktime by following the link. http://www.apple.com/quicktime/download/%20 The administrator of Appomattox Nursing Home is very aware of needing to keep his cost down since he just negotiated a new arrangement with a large insurance company that will pay him a fixed amount per patient day. Listed below are budgeted and actual expenses for the previous month. Actual patient days were 30,000 compared to budgeted patient days of 24,000. Budgeted Costs @ 24,000 Patient Days Budgeted Cost Per Unit Actual Costs @ 30,000 Patient Days Pharmacy Costs Variable $100,000 $4.167 $140,000 Misc Supplies Costs Variable $56,000 $2.333 $67,500 Fixed Overhead Costs $708,000 $29.50 $780,000 Total $864,0000 $36.00 $987,500 a. Determine the total variance associated with the planned and actual expenses.

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