The difference between actual result and corresponding amount of flexible budget, on the basis of actual level of output is classified as ____________?
Correct answer: B. flexible budget variance
- A. sales mix variance
- B. flexible budget variance
- C. sales volume variance
- D. static budget variance
Explanation
A flexible budget is adjusted to the actual output level, so the remaining difference between actual performance and that adjusted budget is the flexible budget variance. Static budget variance instead compares actual results with the original budget at planned output.
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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.
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