Analyzing Budget Impact and Adjustments for Employee Salaries,

Using the Budget Worksheet Template, add an additional employee for October - December. The monthly salary for the employee is $2,000. What impact does that have to your budget? Don't forget to include employer Retirement contributions and other employee benefits. After adding the additional employee, the Total cost per month for employee salaries rose to $80,846. For an employee that averages around $24,000 a year they would receive about $600 per month that would go into employee benefits. $100 of that went into Retirement and the other $500 went into other employee benefits. Adding the additional employee and their salary brought our YTD percentage up to 101% for salary, 100% for retirement, and 102% fro other employee benefits. 2.Because of demand, the practice is going to add an additional physician for October - December. The physician's salary is $8,000 per month. What is the impact to the budget of adding an additional physician? Don't forget to include employer retirement contribution. Adding an additional physician increased the monthly salary total to $68,000. This physician would receive about $2,400 in benefits, $600 going to retirement and $1,800 being allocated to fringe benefits. The addition increased the YTD percentages to, Physician salaries 83%, Physician retirement 75% and the fringe benefits being increased to 112% Which is a bit over budget and may need to be addressed in the near future. 3.You have negotiated lower rates from your drug provider. Effective July your monthly cost for drugs will be $11,000. Calculate the annual cost of drugs for the entire year using the input amount for January - June and the new cost for July - December. What is your actual drug cost? What percentage of your budget for drugs was utilized for the year? Actual drug cost: $156,783 We are over budget using around 115% of the annual budget. This will need to be addressed and adjusted. 4.Your landlord has renegotiated your lease. Starting in October, your monthly building rent will be 19,000. What is your total cost for rent for the year? What percentage of your budget for rent was utilized for the year? Total annual rent: $213,000 We used 102% of the annual budget, which is a bit over. 5.In reviewing the percentages of each category used for the first six months of the year, are there any areas of the budget that you would adjust either up or down and why? There are two areas that I think need to be looked into. The first being Temp Staff support, without a lot of info. I am assuming that this is talking about temp employees. We are going to need to look into better options or we are going to be 18% over the annual budget at the end of the year, if this trend continues. The other that I wanted to take a look at is IT supplies and Maintenance, while I know that we need to make sure that our network and equipment is running optimally. We need to make sure