How does a master budget relate to a flexible budget? What are the differences between them? How is each one used?
How does a master budget relate to a flexible budget? What are the differences between them? How...
10. The difference between a Master Budget and a Flexible Budget is a. Master Budgets are always more important. b. Flexible Budgets are restated to actual results. c. Master Budgets are created on actual results. d. Flexible Budgets are adapted to marketing changes. e. there is no difference if they are for the same period.
Explain what a flexible budget is and how it differs from a master budget. In addition, you must explain why it is important to evaluate managers using activity variances and revenue and spending variances rather than just comparing actual results to the static planning budget.
Actual Results Flexible Budget Variance Flexible Budget Sales Activity Variance Master Budget Units 13,000 ? 2,000 U ? Sales revenue ? 13,000 F ? ? ? Less: Variable mfg. costs $ 87,750 $ 91,000 ? $ 105,000 Variable mktg/adm.costs ? $ 3,250 U ? $ 4,000 F 30,000 Contribution margin $ 52,000 ? ? $ 6,000 U ? What is the master budget sales revenue?
What is the difference between a static and flexible Budget? How are flexible budgets prepared?
What is the difference between a static budget and a flexible budget? When is each used? explain
Actual Results Flexible Budget Variance Flexible Budget Sales Activity Variance Master Budget Units 13,000 ? 2,000 U ? Sales revenue ? 13,000 F ? ? ? Less: Variable mfg. costs $ 87,750 $ 91,000 ? $ 105,000 Variable mktg/adm.costs ? $ 3,250 U ? $ 4,000 F 30,000 Contribution margin $ 52,000 ? ? $ 6,000 U ? What is the sales revenue in the flexible budget?
The difference between actual revenues and expenses and the flexible budget is known as the: A. flexible budget variance B. static budget variance C. master budget variance D. volume variance
What kind of variance represents differences in the flexible budget and the actual results? Direct Labor Rate Variance? Direct Materials Usage Variance? Sales Price Variance? Or all of them?
Complete the following flexible budget and suggest one possible explanation for each of the variances. Master Budget Flexible budget Actual Results Sales volume (in units) 20,000 18,500 Sales Revenue $1,050,000 $972,000 Variable costs 500,000 477,000 Contribution margin 550,000 495,000 Capacity-related (fixed) costs 380,000 385,000 Operating profit $170,000 $110,000
ALL TRUE OR FALSE QUESTIONS: A) Differences between the static planning budget and the flexible budget show what should have happened because the actual level of activity differed from what had been planned. B) Fixed costs should not be included in a flexible budget because they do not change when the level of activity changes. C) An activity variance is the difference between an actual revenue or cost and the revenue or cost in the flexible budget that is adjusted...