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Hello sir,
Just wanted to ask from june 2013 section b, Q5 (a) where budgeted expenditure is calculated:
About the expected capital expenditure, why it is 0.7 * $145000?
I thought it should be just 65000 + 0.7*45000 + 0.3*80000many thanks in advance
65,000 is what they spent last year.
This year they will either spend 145,000 or 80,000 (and they shouldn’t have simply inflated last years cost as they did in the original budget).
sorry again,
my point is where did that 145000 come from as in the question there are two costs : 45000 and 80000In note 3 of the question it says the cost will either be 145,000 or 80,000 – there is no 45,000 mentioned!
And despite that being your point, it is still wrong to add the 65,000 as you wanted to in your original post!
I have a printed version of the paper 3 months ago and it appears 45000, anyway so sorry for wasting time
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