Which of the following is true of a static budget?
A) A static budget represents certain goals that a firm wants to achieve.
B) It divides costs into those that vary with units of production and those that are fixed with respect to unit-level drivers.
C) It ascertains how well costs were controlled during a year.
D) It is best used to create a meaningful performance report.
E) None of these is correct.

Question

Quizplus · Accepted Answer

A static budget represents a firm's predetermined goals for revenue and expenses over a specific period, regardless of actual performance. Option B refers to a flexible budget, option C refers to a variance analysis, and option D refers to a performance report based on a flexible budget. Option E is incorrect as there is a correct answer.

Which of the Following Is True of a Static Budget