BPP revision kit Mar/June 2019 — OpenTuition Forums

EEkta6y ago

Belton park resort Sir with regards to point no 5 of the notes why are we considering the charges of water cost of 12,100 when it is said that they are expected to be same at their current level as there is no change in it.kundky explain.Thanks

John MoffatTutor6y ago#1

For the water park, the water cost was 12,100 per month in the past. You are asked for a budget for January and since the costs are expected to remain at the same level then we expect it to be 12,100 in January also.

EEkta6y ago#2

But isn't it an incremental cash flow so y do we have to consider it if it's going to stay same

John MoffatTutor6y ago#3

You are budgeting for next month and it is an extra flow next month if they keep the waterpark open (an extra flow that will not be incurred if they close the waterpark).

EEkta6y ago#4

So you mean to say we have to prepare this statement by considering those income and expenses which are relevant while keeping the hotel and water park open avoiding the income and expenses when it is closed .Please explain if I am wrong.Thanks

John MoffatTutor6y ago#5

That is correct :-)

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