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Abstract Data derived from general relativistic magnetohydrodynamic simulations of accretion onto black holes can be used as input to a postprocessing scheme that predicts the radiated spectrum. Combining a relativistic Compton scattering radiation transfer solution in the corona with detailed local atmosphere solutions incorporating local ionization and thermal balance within the disk photosphere, it is possible to study both spectral formation and intrinsic spectral variability in the radiation from relativistic accretion disks. With this method, we find that radiatively efficient systems with black holes of 10M_⊙accreting at ≈0.01 in Eddington units produce spectra very similar to those observed in the hard states of X-ray binaries. The spectral shape above 10 keV is well described by a power law with an exponential cutoff. Intrinsic turbulent variations lead to order-unity changes in bolometric luminosity, variations in the logarithmic spectral slope ∼0.1, and factor of 2 alterations in the cutoff energy on timescales ∼50 (M_BH/10M_⊙) ms. Within the corona, the range of gas temperature spans more than 1 order of magnitude. The wide distribution of temperatures is central to defining the spectrum: the logarithmic spectral slope is harder by ∼0.3 and the cutoff energy larger by a factor ∼10–30 than if the coronal temperature everywhere were its mass-weighted mean.