Within the same flexible budget performance report, it is impossible to have both favorable and unfavorable variances.

Question

Quizplus · Accepted Answer

It is possible to have both favorable and unfavorable variances within the same flexible budget performance report. The report compares actual results with the flexible budget for variable costs and actual results with the static budget for fixed costs. Therefore, if actual results are better (lower costs or higher revenue) than the flexible budget, there will be favorable variances. On the other hand, if actual results are worse (higher costs or lower revenue) than the flexible budget, there will be unfavorable variances.

Within the Same Flexible Budget Performance Report, It Is Impossible