Description
Budgetary Variance Model
Prior to completing this assignment, review Assignment 9 in Chapter 17 of your course text. Prepare an evaluation of the performance of the Radiology Department Manager for a hospital.
The service unit, or output, for this department is the number of procedures performed. A static budget was prepared at the beginning of the year. Examine that budget in relation to actual experience. The relevant data are included in Table 17-18 in your course text. The department manager is pleased because the department has a favorable $120,000 cost variance. Evaluate the effectiveness claims of the manager using the budgetary variance mode described in Chapter 17. What is your analysis of the department manager’s performance? Explain your reasoning.
Your paper must include an introduction, thesis, and conclusion. Your paper must be four to five double-spaced pages in length (excluding title and reference pages) and formatted according to APA style as outlined Utilize three scholarly and/or peer-reviewed sources (excluding the course text) that were published within the last five years. Cite your sources within the text of your paper and provide complete references for each source used on the reference page.
Explanation & Answer
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Budgetary Variance Model
Assignment Title: Budgetary Variance Model
Budgetary Variance Model
Introduction
Cost control is essential for the success of an organization (Gapenski & Reiter, 2015).
Cost control is viewed as preventive or detection-correction approach (Cleverley, Cleverley, &
Song, 2011). Variance analysis supports the detection-correction approach. Upon detection of the
problem, corrective actions should be undertaken with less delay to prevent loss of profit of the
organization (Gapenski & Reiter, 2015).
This paper aims at reviewing and evaluating the performance of Radiology Department
of a hospital based on the flexible budget analysis. Radiology Department provides diagnosis and
treatment of diseases and injuries through use of medical imaging techniques (x-ray, CT1 scan,
MRI2, PET3, ultrasound etc.). Based on the flexible budget analysis the validity of the claim of
the manager of Radiology Department based on the static budget analysis regarding the cost
control and operating efficiency of the department will be assessed.
Thesis
The management of the hospital allocates yearly budget for the operation of Radiology
Department. Radiology department can be treated as responsibility center4 in a hospital. Thus,
the manager of the Radiology department is accountable to control the unfavorable variances,
and improvement of the overall operational and financial performance. The manager should
ensure best usage of the allocated funds. The cost of resources must be controll...