Question

When compared to static budgets, flexible budgets: a.encourage managers to use less fixed cost items and more variable cost items that are under their control. b.offer managers a more realistic comparison of budgeted and actual fixed cost items under their control. c.provide a better understanding of the capacity (volume) variances during the period being evaluated. d.offer managers a more realistic comparison of budgeted and actual revenue and cost items under their control.

Answer 1

Answer:

the correct option is D "Offer managers a more realistic comparison of budgeted and actual revenue and cost items under their control".

Explanation:

Static spending plan is fixed in nature though the adaptable spending plan gives the directors the data the what organization the ought to have earned and spent dependent on the yield delivered.

Answer 2

Answer: d. offer managers a more realistic comparison of budgeted and actual revenue and cost items under their control.

Explanation: A flexible budget is a budget that is flexible, in that it changes with changes in volume or activity.  It reflects the expenditure appropriate to various levels of output and offers managers a more realistic comparison of budgeted and actual revenue and expenditure under their control  that is applicable for that particular level of activity attained or achieved. As such it is far more useful and sophisticated than the static budget (whose budget amounts do not change) prepared before the fiscal period began when the production/activity level was uncertain.