A flexible-budget variance for any fixed cost:
A) Is defined as the difference between flexible-budget fixed cost and the level of fixed costs reflected in the master (static) budget.
B) Is undefined, except when actual output equals budgeted output.
C) Is typically zero, because the volume assumed in the flexible budget and the master budget for fixed costs is identical.
D) Is the difference between budgeted fixed cost and actual fixed cost.
E) Can be broken down into price and efficiency components.

Question

Quizplus · Accepted Answer

The Answer of A flexible-budget variance for any fixed cost:
A) Is defined as the difference between flexible-budget fixed cost and the level of fixed costs reflected in the master (static) budget.
B) Is undefined, except when actual output equals budgeted output.
C) Is typically zero, because the volume assumed in the flexible budget and the master budget for fixed costs is identical.
D) Is the difference between budgeted fixed cost and actual fixed cost.
E) Can be broken down into price and efficiency components.

A Flexible-Budget Variance for Any Fixed Cost