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DHA Clinical Dietitians (DHA-Diet) Practice Tests & Test Prep

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DHA Clinical Dietitians Sample Test

1 of 5

Utility costs should account for approximately what percentage of an overall operating budget?

Correct Answer:

12-18%.

utility costs in a business generally include expenses for electricity, water, gas, and other essential services needed to maintain daily operations. these costs can also encompass expenditures for specific needs such as laundry services, especially in businesses where clean linens, uniforms, or other fabrics are essential, such as in hotels, hospitals, and dining establishments.

the recommended percentage of the overall operating budget devoted to utility costs is 12-18%. this range is advised because it balances the necessity of these services with the overall financial health of the business. keeping utility costs within this percentage helps ensure that the business can afford these essential services without compromising its ability to fund other critical areas like payroll, maintenance, and new development projects.

utility costs are considered less flexible compared to other expenses such as food or labor. this inflexibility stems from the fact that utilities are a basic requirement for the operation and safety of the business and often have fixed minimum costs associated with their consumption and demand charges. unlike labor costs, where staffing can sometimes be adjusted based on business volume, or food costs, which can vary with menu choices and supplier negotiations, utility costs tend to be more constant, and the potential for reductions can be limited to efficiency improvements and contract negotiations.

managing utility costs effectively within the 12-18% guideline involves monitoring usage to identify any areas where waste can be reduced, investing in energy-efficient appliances and fixtures, and possibly renegotiating contracts with utility providers for more favorable rates. by maintaining utility costs within this percentage range, businesses can better manage their budgets and allocate resources to other areas that can enhance profitability and operational efficiency.