Budgeting & Financial Management Flashcards

A conference has fixed costs of $60,000, a registration fee of $500, and a variable cost of $200 per attendee. How many paid attendees are needed to break even?

Answer: 200

Break-even = fixed costs ÷ (price − variable cost) = 60,000 ÷ 300 = 200 attendees.

Which cost is most likely to be classified as fixed in a meeting budget?

Answer: Keynote speaker honorarium

A speaker fee stays the same no matter how many attendees register, making it a fixed cost.

In zero-based budgeting, how is each line item for a recurring annual meeting determined?

Answer: Justified from scratch each cycle based on current needs

Zero-based budgeting requires every expense to be justified anew rather than carried over from prior years.

A hotel adds a 24% service charge to F&B and the state imposes sales tax on that service charge. On a $10,000 food minimum with 8% tax applied to both, what is the total?

Answer: $13,392

$10,000 + $2,400 service charge = $12,400, and 8% tax on $12,400 adds $992 for $13,392.

What is the primary purpose of a contingency line in a meeting budget?

Answer: To cover unforeseen expenses or revenue shortfalls

A contingency reserve, often 5-10%, protects against unexpected costs and shortfalls.

An organization wants to compare an event's net program benefits to its fully loaded costs as a percentage. Which metric fits?

Answer: Return on Investment (ROI)

ROI = (net program benefits ÷ program costs) × 100, expressing monetary return as a percentage.

Which practice best supports accurate variance analysis after an event?

Answer: Tracking budgeted versus actual figures line by line

Line-item comparison of budget to actuals reveals where and why variances occurred.