If a concert has $10,000 of Fixed Costs, Variable Costs of $5 per person, and the selling price of a concert ticket is $10, how many paying concert goers are needed to break-even?
1000 persons
2,000 persons
200 persons
100 persons
If the annual budget for electricity is $1,000 and the amount actually spent in the appropriate financial period is $800, which of the following is most correct?
There is a $200 variance for Electricity .
There is a $200 adverse variance for Electricity.
There is a a $200 favourable variance for Electricity.
There is $1,800 variance for Electricity.
Which of the following is NOT correct?
Superannuation is an extra cost of employment and must be added to the gross salary to obtain the full cost of employment.
Superannuation is an accumulation of funds paid by the employer and sometimes the employee to provide for the employee in their retirement.
Superannuation is a cost of the employee only, however the employer deducts the cost from the employees salary and remits it to the superannuation fund.
Superannuation is a cost of the employer, butemployees cannot contribute out of their pay as well.
Which of the following is NOT a purpose of budgeting?
Provide a forecast of revenues and expenditures
Keep records of actual income and expenditure
Provide a financial plan for the business
Provide a financial framework for the decision making
The principle of conservatism as applied in budgeting means:
You should underestimate your income and overestimate your expenses.
You should overestimate your income and your expenses.
You should underestimate your income and your expenses.
You should overestimate your income and underestimate your expenses.
Which of the following answers do you think portrays the best two sources of information for budgeting
Historical accounting records and information gained from other organisations of a similar nature.
The organisations business plan and information gained from other organisation's of a similar nature.
Historical accounting records
Historical accounting records and the organisation's business plan.
The organisation's business plan
If inflation is running at 5% per annum, what would you expect a business to do in a budgeting context?
Increase the price of products and services by 5% across the board
Make a provision for bad debts in the order of 5%
Make provision for a 5% increase in the interest cost of loans from banks and other financial institutions.
Change the rate of superannuation payments to 5% of gross salaries and wages.
Which of the following is NOT an example of an overhead expense in a retail business?
The purchase cost of goods sold
The leasing cost of the shop
Public liability insurance for the shop
Newspaper advertising costs
Which of the following would most likely NOT be classified as Variable Costs if you were staging a sporting event?
Trophies
Refereeing costs
Venue cost
T-Shirts for all competitors with sponsor's logo
Which of the following is the best explanation of 'Cost Centre'?
A cost centre is a part of the business that collects information on expenditure.
A cost centre is a part of the business that aims to control expeniture.
A cost centre is a part of the business which attracts costs but no income.
A cost centre is a part or department of the business to which income and expenditure is allocated in order to calculate profit of the department.