Static and Flexible Budgets

Описание к видео Static and Flexible Budgets

A static budget is a based on one level of activity. These budgets do not consider data for different levels of activity. As a result, companies compare actual results with budget data at the activity level that was used in developing the master budget. In many situations, these budgets are not appropriate for evaluating a manager's performance in controlling costs. A flexible budget takes into account that changes in activity affect costs. A flexible budget is an estimate of what revenues and costs should have been given the actual level of activity.

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