CCEP Budgeting & Financial Management 2

Question 1

A conference planner discovers mid-event that catering costs will exceed budget by 18%. What is the BEST immediate action?

Accepted Answer

Identify and cut costs in other budget line items

Answer

When one line item overruns, reallocating savings from other categories maintains overall budget integrity without disrupting the event.

Question 2

Which financial document provides a snapshot of an event's assets, liabilities, and net worth at a specific point in time?

Accepted Answer

Balance sheet

Answer

A balance sheet captures financial position at a moment in time, listing assets against liabilities to show net worth or equity.

Question 3

An event planner budgets $50,000 for a gala but actual costs come in at $47,500. This $2,500 difference is called a:

Accepted Answer

Favorable variance

Answer

When actual costs are lower than budgeted amounts, the resulting difference is a favorable (positive) variance.

Question 4

What is the purpose of a master account in hotel event billing?

Accepted Answer

To consolidate all event-related charges for direct billing to the organizing entity

Answer

A master account aggregates all event charges—AV, F&B, room rental—so the organization receives one consolidated invoice.

Question 5

The break-even point for a ticketed conference occurs when:

Accepted Answer

Total revenue equals total expenses (fixed + variable)

Answer

Break-even is achieved when all revenue sources exactly cover all costs, both fixed and variable, resulting in zero profit or loss.

(CCEP) Certified Conference and Events Professional Practice Test