Budgeting help please
Hoamai
New MemberRegistered Posts: 10
Hi all,
I am doing practice assessment 1 in workbook (osborn), task 2.2:
original actual flexed
volume (unit) 90000 80000 80000
energy (£) 55000 55000
the fixed element is £10000
the answer for flexed is £50000.
I tried to work out many ways like hight low but can not find the correct answer for the flexed budget.
I would appreciate if you guy can show me how to get the answer.
I am doing practice assessment 1 in workbook (osborn), task 2.2:
original actual flexed
volume (unit) 90000 80000 80000
energy (£) 55000 55000
the fixed element is £10000
the answer for flexed is £50000.
I tried to work out many ways like hight low but can not find the correct answer for the flexed budget.
I would appreciate if you guy can show me how to get the answer.
0
Comments

Hi all,
I am doing practice assessment 1 in workbook (osborn), task 2.2:
original actual flexed
volume (unit) 90000 80000 80000
energy (£) 55000 55000
the fixed element is £10000
the answer for flexed is £50000.
I tried to work out many ways like hight low but can not find the correct answer for the flexed budget.
I would appreciate if you guy can show me how to get the answer.
With flexed budgets you're only ever looking at the original budget figures so in the original budget you had energy costs of £55,000 for a volume of 90,000 units. Of this £10,000 was fixed so £45,000 was variable, this equates to £45,000/90,000 = 50p per unit. Now apply this to the flexed budget  80,000 units x 50p = £40,000 plus the fixed part of £10,000 makes £50,000.0 
Thank you very much coojee. I am clear now0