- This topic has 3 replies, 2 voices, and was last updated 2 years ago by
.
- Posts
hello sir, i was doing this question yumi co, please clarify.
why rent rates and other overheads needs to be fixed and not variable, why is this a weakness? even tho if actual compared with flexed, it is 9000 in flexed budget and in actual is 8100. doesn’t this show good performance? as the costs are lower.
same thing for salary, they say it should be semi-variable & not purely variable.
Note (1) of the question specifically states that rent, rates, and other overheads are a fixed annual charge, and nobody is saying that this is a weakness.
The figures you quote are for heat, light, and power. Although we treat these as being variable because the question says to do so, almost certainly a real life part of the cost will be fixed. For example, it is very common to have to pay a fixed charge for an electricity connection (needed for the lighting) in addition to a variable charge for the electricity actually used.
As for wages, most employees tend to be paid a fixed wage – it is unusual in real life for the pay of all restaurant staff to vary with the number of customers. Think about it – sure at least the cook will be paid the same whether there are 10 customers or 20 customers 🙂
- The topic ‘Yumi co 2019’ is closed to new replies.