What type of analysis does a flexible budget performance report help management perform
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1.What type of analysis does a flexible budget performance report help managementperform? Show Get answer to your question and much more 2.What is a price variance? What is a quantity variance? Get answer to your question and much more 3.What are the relations among standard costs, flexible budgets, variance analysis, andmanagement by exception? Get answer to your question and much more Chapter 10 Flexible Budgets and Overhead Analysis Using Budget for Performance Evaluation Budgets are useful for both planning and control, where they are used as benchmarks for performance evaluation. Determining how budgeted amounts should be compared with actual results is a major consideration that must be addressed. Static Budgets versus Flexible Budgets A performance report compares actual costs with budgeted costs. There are two ways to make this comparison: Compare actual costs with the budgeted costs for the budgeted level of activity. Compare actual costs with the actual level of activity The first choice is a report based on static budgets , whereas the second choice is for a report based on flexible budgets . Static Budgets and Performance Reports A static budget is a budget created in advance that is based on a particular level of activity. Master budgets are generally created for a particular level of activity. Thus, one way to prepare a performance report is to compare the actual costs with the budgeted costs from the master budget. Example 1: ETHICAL DECISIONS: Companies that use static budgets as the benchmark for performance evaluation invite potential abuse by managers. Although unethical, a What is the use of flexible budget to analyze performance?A flexible budget performance report is used to compare actual results for a period to the budgeted results generated by a flexible budget.
What is flexible budget analysis?A flexible budget is kind of a hybrid approach to financial planning. It begins with a static framework built from the costs that are not anticipated to change throughout the year. Layered on top of that is a flexible budget system allowing for variable costs to fluctuate based on sales performance.
What does a flexible budget performance report?Definition: A flexible budget performance report is a management report that compares the actual revenues and costs for a period with the budgeted revenues and costs based on the actual sales volume.
What is the purpose of budget performance reports?The Profit & Loss by Budget Performance Report lines up your forecasted budget alongside your actual numbers over a specific financial period. This allows you to easily see what 'budget items' went as expected, which outperformed expectations, and which did not meet expectations.
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