A disadvantage of static budgets is that they:
A)start with a clean slate.
B)cannot be used by service companies.
C)do not show possible changes in underlying activity levels.
D)show the expected results of a responsibility center for several levels of activity.

Question

Quizplus · Accepted Answer

Static budgets are prepared based on a predetermined level of activity and cannot be adjusted for changes in underlying activity levels. This makes them inflexible and possibly unreliable in predicting actual results.

A Disadvantage of Static Budgets Is That They