Explaining Costs That Change with Flexible Budget ActivityWhen preparing a company's flexible budget, which manufacturing cost(s) will change as the volumeincreases or decreases? Which manufacturing cost(s) will not change as the volume changes?

Budgets: Budgets are prepared for the planning and controlling purposes. Budgets facilitate…

Answered: Explaining Costs That Change with…

Principles of Accounting Volume 2

19th Edition

ISBN:9781947172609

Author:OpenStax

Publisher:OpenStax

Chapter7: Budgeting

Section: Chapter Questions

Problem 7TP: When would a static budget be effective in evaluating a managers performance?

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Similar questions

Why is it important to distinguish between variable costs and fixed costs for budgeting purposes?
Why is the concept of relevant range important when preparing a flexible budget?
When would a static budget be effective in evaluating a managers performance?
Is a standard cost an estimated cost? What is the primary objective of employing standard costs in a cost system? > What is a budget? > What is the difference between ideal and practical standards? Which standard generally is used in planning? > What is meant by the term management by exception? > What are some advantages of using standard costs? What are some disadvantages?
Why Do Companies Need Flexible Budgets?
What is a standard cost? Group of answer choices The total number of units times the budgeted amount expected Any amount that appears on a budget The total amount that appears on the budget for product costs The amount management thinks should be incurred to produce a good or service
What are standard costs and why do companies use standard costs? Discuss the difference between ideal and practical standards. Which is most useful to a company and why? In your opinion, what are the two most significant advantages and disadvantages of using standard costs? Support your opinion. What is a static planning budget? Is it useful? Why or why not? What is a flexible budget? How does it differ from a static planning budget? Explain why the flexible budget more useful than the static planning budget.
Why might managers find a flexible-budget analysis more informative than a static-budget analysis?
Question: What is the purpose of a flexible budget? a) To control costs and evaluate performance b) To prepare financial statements for external reporting c) To forecast long-term strategic goals d) To allocate overhead costs
Management Accounting Question (Qualitative Short Answer) a. Why is the sales forecast the starting point in budgeting? b. What is a perpetual budget? c. Which is a better basis for evaluating actual results: budgeted performance or past performance? Why? d. The materials price variance can be computed at what two different points in time? Which point is better and why? e. What effect, if any, would you expect purchasing poor-quality materials to have on direct labor variances? f. Distinguish between ideal and practical standards. g. Costs associated with the quality of conformance can be broken down into four broad groups. What are these four groups and how do they differ? h. What is likely the most effective way to reduce a company's total quality costs? i. What are the three main uses of quality cost reports?
What is a flexible budget performance report?
What is the difference between a flexible budget and a static budget? Which one do you believe works better for a business you have worked for or about which you are familiar?

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Explaining Costs That Change with Flexible Budget Activity When preparing a company's flexible budget, which manufacturing cost(s) will change as the volume increases or decreases? Which manufacturing cost(s) will not change as the volume changes?