Consider the following items of income and expense and state: whether they bear
ID: 2508059 • Letter: C
Question
Consider the following items of income and expense and state: whether they bear a relationship to each other or not; if they are related in any way, in what way they should move in relation to each other; the reasons for your answer in each case:
a) Newspaper advertising income
-Number of rolls of newsprint used
-Circulation revenue
-Number of column classified advertising inches
b) Fuel costs of a bus company
-number of passengers carried
- depreciation on bus fleet
-driver wages
c) Fees of practicing accountant
-quantity of stationary purchased
-charge-out-rates
-office rental
Explanation / Answer
a) Newspaper advertising income
-Number of rolls of newsprint used: Not related
-Circulation revenue:Directly related since as more papers circulated then there is more chance of people advertise in it
-Number of column classified advertising inches: Directly proportional
b) Fuel costs of a bus company
-number of passengers carried: Not related
- depreciation on bus fleet:It is related since as bus becomes old the performance comes down and required more fuel
-driver wages:Not related
c) Fees of practicing accountant
-quantity of stationary purchased:Not relatd
-charge-out-rates:Related
-office rental:not related
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