Answer:
Variable expenses ratio =60%
Explanation:
The variable expense ratio is the percentage of the sales revenue that is incurred as variable cost expenditures. It is used to determined how well a business is managing and controlling costs that vary with the level of activity.
Note that variable costs are those expenditure that vary with level of activity,for example , the higher the level of sales, the more variable expenditures are incurred.
Variable expenses ratio is computed as follows:
Variable expenses ratio = Variable expense/sales revenue × 100
DATA
Variable expense -192,000
Sales revenue-320,00
Variable expenses ratio = 192,000/320,000 ×100 = 60%
Variable expenses ratio =60%
