Rosa Has Several Creative Ideas for Organizing Events and Starts

question 94

Multiple Choice

Rosa has several creative ideas for organizing events and starts an event management company. However, with little knowledge about running a business, she is unable to handle the finance and marketing sides of the business. As a result, she faces huge losses and eventually shuts down the company. Which of the following threats is highlighted in the given scenario?

• A) Lack of knowledge
• B) Too little money
• C) Bigger regulatory burden
• D) Higher health insurance costs

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Definitions:

Variable Overhead Efficiency Variance

The difference between the actual variable overhead incurred and the standard cost of variable overhead allocated for the actual production level, often driven by efficiency in using the variable overhead resources.

Variable Overhead Rate Variance

The difference between the actual variable overhead incurred and the standard cost allocated, based on the actual amount of the allocation base used.

Supplies

Materials and items used in the daily operations of a business that do not directly become part of the final product.

Flexible Budget

A budget that modifies based on fluctuations in activity levels or volume.