A static budget report is appropriate for
A) fixed manufacturing costs.
B) fixed selling and administrative expenses.
C) variable selling and administrative expenses.
D) both fixed manufacturing costs and fixed selling and administrative expenses.

Question

Quizplus · Accepted Answer

A static budget report is appropriate for fixed costs because it is prepared based on a predetermined level of activity. Fixed manufacturing costs and fixed selling and administrative expenses are both predetermined and do not vary with changes in activity levels, making them ideal for a static budget report. Variable costs, on the other hand, change with changes in activity levels and require a flexible budget report.

A Static Budget Report Is Appropriate for