Mikey A.

asked • 10/01/14

help! don't understand this problem.

Rich budgets $2,500 in expenses for the month of January. He set up the following groups:

Fixed: 60%
Variable: 40%

and the following categories and percents:

Food: 30%
Transportation: 23%
Utilities: 22%
Entertainment: 13%
Personal: 12%

How much did Rich budget for transportation in January?

2 Answers By Expert Tutors

By:

Damazo T.

Thanks... It makes sense to me.  I am going to change my answer.
 
D.Y. Taylor
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10/01/14

Damazo T.

Now that I am thinking about is transportation a fixed expense?  Unless you buy a bus pass that costs a certain amount of money every month, I don't think transportation will be a fixed but a variable expense? A fixed cost will be something like rent, or car payment, or insurance payment... Something that does not varies. In my opinion, food, personal, entertainment, and all the categories mentioned are variable expenses rather than fixed.  What do you think? And on what do you based that opinion?
 
D.Y. Taylor
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10/01/14

Damazo T.

I am thinking pf transportation as car plus gas.. I don't drive, but I am assuming that you don't spend exactly the same amount of gas every month. If it changes, then it is not fixed, but variable!
D.Y. Taylor
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10/01/14

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