TAK is a sole proprietorship business set up by Tom that focuseson providing tour and travel services to tourists. The setup costsincluded a good amount of fixed costs and variable costs grew as heran his business. As he operated his business Tom became aware ofsemi-variable costs that also had an impact on his costing. In hisfirst year, he did not make any profit because his revenue wasquite insignificant especially following the downturn in theeconomy. He has therefore resorted to cut down on his costs andseek for more revenue streams so as to guarantee a profit by theclose of next year. He has approached a financial consultant tohelp him improve the performance of his business.
a) Define the following terms:
(i) fixed costs
(ii) revenue
(iii) profit
b) Using examples explain the term \"semi-variablecosts”
c) Explain three ways the financial consultant may advise Tom onhow to improve his revenue streams

Answer rating: 100% (QA)

a Definition of the terms i Fixed costs Fixed costs are expenses that do not vary with the level of production or sales volume These costs remain constant regardless of the businesss activity level ov... View the full answer