Variance Analysis and Justification
PROMPT
Reflection
Reflect on your readings and identify two key points that provided clarity to assist in your understanding of variance analysis.
Application:
Review the variance reporting on pages 161-169 of your textbook. (I ATTACHED SCREENSHOTS OF PAGES)
TEXTBOOK: Leger, J. & Dunham-Taylor, J. Financial management for nurse managers: Merging the heart with the dollar. 4 th ed. Jones & Bartlett. ISBN: 978-1-284-12725-6
Departmental and administrative leaders must routinely evaluate their monthly operating budgets for variances and develop action plans to correct areas of missed opportunity.
Imagine you are the leader of this department’s cost center. Utilizing your learning thus far in the module, prepare an explanation of the variance and your plan to correct or justify the overages noted. You may use one of two assumptions:
Budgeted volume for the cost center was at budget; therefore expenses were not controlled for salaries and supplies. Develop an action plan to align expenses to budget for the next reporting month.
Volumes exceeded budget by 20% (there were 20% more patients receiving care in the month). Analyze if this increase in patient volume offset the personnel cost and care supply costs for the unit.
Justify your rationale for your selection of scenario 1 or 2 in a 3-4 paragraph post on the discussion board. (Please do not use attachments).
GUIDELINES
Each question should have a heading in bold to delineate the portion of the discussion to which you are addressing.
Each section of the initial post response should be a minimum of 250-300 words in length and must include appropriate in-text citations, scholarly writing, and formatted using APA 7th edition.
The body of the post should demonstrate appropriate grammar and sentence structure mechanics. Please avoid contractions, slang, and ensure acronyms are spelled out the first time used in the post. Posts do not need to be double-spaced.
A minimum of 3 scholarly source from a journal article or research external to the course content.