What Best Describes a Flexible Budget

A flexible budget is a budget that adjusts or flexes with changes in volume or activity. This budget is used to determine whether an entity has adequate cash to operate.

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A budget set within the framework of strategic plans determined by top management.

. 2 9 Which one of the following statements best describes a flexible budget. Flexible budget is a budget that is mostly used as a static budget A Static Budget A static budget is one that anticipates all revenue and expenses which will occur during a particular period with changes in the level of productionsales or any other major factor having no effect on the budgeted data. The correct answer is.

This month the actual selling price was higher than projected in the static budget. The main importance of flexible budget is that it reflects the expenditure appropriate to various levels of output. Calculate the flexible budget for costs based on budgeted variable cost per output standard quantity of output and budgeted fixed.

The Chartered Institute of Management Accountants England defines a flexible budget also called sliding scale budget as a budget which by recognizing the difference in behaviour between fixed and variable costs in relation to fluctuations in output turnover or other variable factors such as number of employees is designed to change appropriately with such. Option A best describes a cash budget therefore it is the correct answer. It is prepared for various activity level.

A flexible budget is made to know the various cost and revenue composition at a various level of activity. Identify the actual quantity of output. The expenditure established through a flexible budget is suitable for comparison of the actual expenditure incurred with the budgeted level applicable for that particular level of activity attained.

A flexible budget uses realized actual. In short the flexible budget is a more useful tool when measuring a. A budget which is set without permitting the ultimate budget holder to participate in the budgeting process.

A flexible budget adjusts to changes in actual revenue levels. A flexible budget is also known as a flex budget. Definition of a Flexible Budget A flexible budget is a budget that adjusts or flexes with changes in volume or activity.

Select the choice that best describes the steps in developing a flexible budget. Terms Similar to Flexible Budget. A flexible budget identifies fixed costs separately from variable costs.

The budget is then compared to actual expenses for control purposes. Calculate the flexible budget for revenues based on budgeted selling price and actual quantity of output. They remain unchanged from the amounts established at the time that the static budget was prepared and approved.

It is also known as a fixed budget. A budget which by recognising different cost behaviour patterns is designed to change as the volume of activity changes. A company is analyzing month-end results compared to both static and flexible budgets.

Thus it shows the budget of the company that changes with the change in its activity level. A budget is an estimate of revenue and expenses for a given future period of time that is usually created and. Identify the standard quantity of output.

Fenton plc has prepared the following flexible budget for the coming year. A flexible budget facilitates control by establishing a budget relevant to actual activity levels. A budget which shows sales revenue and costs at different levels of activity d.

Which of the following BEST describes flexible budget variance. A monthly budget which is changed to reflect the number of days in the month. A budget that is updated halfway through the year to incorporate the actual results for the first half of the year.

A flexible budget also called a variable budget is financial plan of estimated revenues and expenses based on the current actual amount of output. Calculate the flexible budget for costs based on budgeted variable cost per output standard quantity of. A flexible budget uses realized actual supplies costs along with all other original simple budget assumptions.

A budget that is updated halfway through the year to incorporate the actual results for the first half of the year. The result is that a flexible budget yields a budgeted cost of goods sold of 37 million at a 9 million revenue level rather than the 4 million that would be listed in a static budget. An estimation of the cash flow for a business over a certain period is referred to as a cash budget.

Last month budgeted production was 8000 units and the standard fixed production overhead cost was 15 per unit. What is a Flexible Budget. Actual revenues or other activity measures are entered into the flexible budget once an accounting period has been completed and it generates a budget that is specific to the inputs.

It could also include anticipated sales volumes and revenues resource quantities costs and expenses assets liabilities and cash flows. Select the choice that best describes the steps in developing a flexible budget. Calculate the flexible budget for revenues based on budgeted selling price and standard quantity of output3.

A flexible budget is a budget that adjusts to the activity or volume levels of a company. B A budget that comprises variable costs only. A flexible budget uses realized actual labor costs along with all other original simple budget assumptions.

Which of the following BEST describes a flexible budget. A A budget that is adjusted to reflect different costs at different activity levels. To plan income and expenses.

Actual production last month was 8500 units and the actual fixed production overhead cost was 17. A flexible budget uses realized actual prices along with all other original simple budget assumptions. Select the choice that best describes the steps in developing a flexible budget.

The flexible budget is more sophisticated and useful than a static budget. A Difference between actual amounts and the flexible budget due to differences in price and costs. A budget which shows sales revenue and costs at different levels of activity.

A budget is a financial plan for a specific time period usually one year. In other words a flexible budget uses the revenues and expenses produced in the current production as a baseline and estimates how the revenues and expenses will change based on changes in the output. The flexible budget is more sophisticated and useful than a static budget.

Identify the standard quantity of output. The static budget amounts do not change. View the full answer.

A company uses a standard absorption costing system. Calculate the flexible budget for revenues based on budgeted selling price and standard quantity of output. A budget which has been set by scaling down individual expenditure items until the total budgeted expenditure can be met from available resources.

Prepare Flexible Budgets Principles Of Accounting Volume 2 Managerial Accounting

Prepare Flexible Budgets Principles Of Accounting Volume 2 Managerial Accounting

This Video Has Helped Me Understand The Concept Of Variance Analysis It Outlines The Whole Process Of Variance Analysis And Analysis Budgeting Cost Accounting