COST ACCOUNTING
RESPONSIBILITY ACCOUNTING
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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A flexible budget uses realized (actual) prices along with all other original (simple) budget assumptions.
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A flexible budget uses realized (actual) labor costs along with all other original (simple) budget assumptions.
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A flexible budget uses realized (actual) supplies costs along with all other original (simple) budget assumptions.
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A flexible budget uses realized (actual) volume along with all other original (simple) budget assumptions.
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Detailed explanation-1: -c. A flexible budget uses realized (actual) supplies costs along with all other original (simple) budget assumptions.
Detailed explanation-2: -Answer and Explanation: The correct answer is *a) Consists of estimates of costs and expenses for various possible levels of activity. Flexible budgets are accounting tools that calculate different expenditure levels for variable costs, depending upon changes in actual revenue.
Detailed explanation-3: -The correct answer is d. It calculates total variable cost by multiplying actual units by budgeted variable cost per unit.
Detailed explanation-4: -Answer: b. A flexible budget provides cost allowances for different levels of activity, whereas a static budget provides costs for one level of activity.
Detailed explanation-5: -Answer and Explanation: The correct answer is a. Flexible budgets are based on different assumptions about cost behavior than those used for static budgets. Flexible budgets do not assume different cost behaviors than static budgets but rather they assume different levels of activity.