A flexible budget performance report with more than one cost driver will always have more unfavorable revenue and spending variances than a performance report with only one cost driver.

Question

Quizplus · Accepted Answer

A flexible budget performance report's variances, whether favorable or unfavorable, depend on actual performance compared to budgeted amounts, not on the number of cost drivers. Multiple cost drivers can lead to a more accurate allocation of costs, potentially reducing unfavorable variances.

A Flexible Budget Performance Report with More Than One Cost