A static budget is
A) considered a good choice for benchmarks in preparing a performance report.
B) computes expected costs for a range of activity levels.
C) compares actual costs with budgeted costs.
D) prepared for a particular level of activity.
E) None of these are correct.

Question

Quizplus · Accepted Answer

A static budget is prepared for a particular level of activity, therefore it is not useful for comparing actual costs with budgeted costs for different levels of activity. It may be useful as a benchmark only if actual activity levels are the same as the level in the static budget.

A Static Budget Is