If an actual result is $5500 and corresponding amount of flexible budget on the basis of actual level of output is $3500, then flexible budget variance will be __________?
Correct answer: D. $2,000
- A. $2,500
- B. $5,500
- C. $3,500
- D. $2,000
Explanation
Flexible budget variance is measured as the difference between actual performance and the flexible-budget amount at actual output: $5,500 − $3,500 = $2,000. The favorable or unfavorable label would depend on whether the figures represent revenue or cost, but the numerical variance is clear.
Report an error
The more specific you are, the faster it gets fixed. A source beats an opinion.
Prefer email? support@testustad.com
About Cost Accounting
Cost accounting measures and analyses the cost of producing goods or providing services for planning, control and pricing decisions. It covers direct and indirect costs, fixed and variable costs, job and process costing, break-even analysis, marginal costing, overhead allocation, and the difference between product cost and period cost.
Practise Cost Accounting
941 free Cost Accounting MCQs from Accounting, each with the correct answer and an explanation. Unlimited attempts, no account needed.
Exams that ask Accounting questions like this
Accounting is on 2 papers prepared for on TestUstad, and all of them draw the same bank, so this question is worth knowing for every one of them.
More Cost Accounting questions
For increasing sales, the decrease in selling price, below the selling price list is known as ____________?
If the budgeted contribution margin for budgeted and actual sales mix are $35000 and $27000, then the sales mix variance will be __________?
In corporate costs, the cost incurred to finance construction of new equipment are classified as ___________?
The difference between budgeted contribution margin for actual sales mix and budgeted sales mix is called __________?
If the static budget amount is $6200 and the flexible budget amount is $4500, then the sales volume variance will be _________?
In corporate costs, the costs incur for employee recruitment, development and training are classified as __________?