Amir Is Writing the Budget Section of a Business Proposal

question 49

Multiple Choice

Amir is writing the budget section of a business proposal seeking funding for a concert, "Music for a Cause." After careful calculation, he concludes that a total of $12,000,000 will be required for the event. Which of the following is an appropriate guideline that will help him win the bid?

• A) State an amount much lower than $12,000,000 to increase his chances of winning.
• B) Exclude less obvious costs such as overhead, which can be negotiated.
• C) Avoid including costs that will be paid from other sources since they are irrelevant.
• D) Ask for $12,000,000 since it is required for the event to be successful.
• E) Find out what others are bidding and quote a budget accordingly.

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Definitions:

Intra-entity Gross Profit

The profit made on transactions within the same company or between subsidiaries under the same parent company not yet realized outside the entity.

Equity Method

The Equity Method is an accounting technique used to record investments in associate companies, where the investment's carrying value is adjusted to recognize the investor's share of the associates' profits or losses.

Voting Common Stock

Shares of a company that grant the holder the right to vote on corporate matters at shareholder meetings.