Managing Financial Resources: Budgeting and Performance Metrics

MANAGING FINANCIAL
RESOURCES

Table of Contents
SECTION A.....................................................................................................................................3
Question 2....................................................................................................................................3
SECTION B.....................................................................................................................................5
Question 5....................................................................................................................................5
Question 6....................................................................................................................................7
REFERENCES................................................................................................................................1

SECTION A
Question 2
(a) Computation of fixed and variable component of the event committee
Fixed Expenses: This are the expenses which remain constant with the change in the
level of activity. This are the cost which the company have to pay independent of any business
activities. Whether the company are earning profit or incurring loss they have to pay fixed cost
which are also known as indirect cost or overheads cost (Laureano, Trindade and Laureano,
2021). This are not dependent on the number of outcome or output. The fixed component of the
Cleveland Recreation Centre event budget prepared by the committee are as follows:
Particulars Details Amount (£)
Ballroom rental Not associated with per guest 2900
Entertainment Not associated with the
number of guest
4500
Printing Apart from £9 per guest 600
Decoration and favours Apart from £5 per guest 700
Total Fixed cost associated with event 8700
Variable expenses: This are the cost which are variable it means changing in nature thus
this changes over the period of time as per the change in level of activity. These are basically the
sum of marginal cost which are used in the production of the units. It can also be known as
normal cost which easily get reduces with the increase in the efficiency of the workforce of the
event. The various example of variable expenses in an organization is direct material, labour,
expenses etc. The variable component of the event prepare by the committee is as follows:
Particular Per guest Amount
Printing £9 £27000
(3000 people * £9)
Food £29 £87000
(3000 * £29)
Decoration and favours £5 £15000
(3000 * £5)
Total £43 per guest £129000