A planning budget is prepared before the period begins and is valid for only the planned level of activity. TRUE OR FALSE 2. An unfavorable activity variance for a cost indicates that spending was higher than it should have been for the actual level of activity for the period. TRUE OR FALSE 3. The activity variance for revenue is unfavorable if the actual revenue for the period is less than the revenue in the static planning budget. TRUE OR FALSE 4. If the actual level of activity is 4% more than planned, then the fixed costs in the static budget should be increased by 4% before comparing them to actual costs. TRUE OR FALSE
Master Budget
A master budget can be defined as an estimation of the revenue earned or expenses incurred over a specified period of time in the future and it is generally prepared on a periodic basis which can be either monthly, quarterly, half-yearly, or annually. It helps a business, an organization, or even an individual to manage the money effectively. A budget also helps in monitoring the performance of the people in the organization and helps in better decision-making.
Sales Budget and Selling
A budget is a financial plan designed by an undertaking for a definite period in future which acts as a major contributor towards enhancing the financial success of the business undertaking. The budget generally takes into account both current and future income and expenses.
1. A planning budget is prepared before the period begins and is valid for only the planned level of activity. TRUE OR FALSE
2. An unfavorable activity variance for a cost indicates that spending was higher than it should have been for the actual level of activity for the period. TRUE OR FALSE
3. The activity variance for revenue is unfavorable if the actual revenue for the period is less than the revenue in the static planning budget. TRUE OR FALSE
4. If the actual level of activity is 4% more than planned, then the fixed costs in the static budget should be increased by 4% before comparing them to actual costs.
TRUE OR FALSE
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