A Master budget is called a Static budget because a. It is developed around unchanging (static) Sales Volumes at unchanging (static) Unit Costs b. It is developed around unchanging (static) Sales Volumes with changing Unit Costs c. It is developed around changing Sales Volumes with unchanging (static) Unit Costs
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.
A
| a. |
It is developed around unchanging (static) Sales Volumes at unchanging (static) Unit Costs |
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| b. |
It is developed around unchanging (static) Sales Volumes with changing Unit Costs |
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| c. |
It is developed around changing Sales Volumes with unchanging (static) Unit Costs |
A Flexible Budget will show
| a. |
Budgeted Sales Volumes at the original Budgeted Unit Costs |
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| b. |
Actual Sales Volumes at the original Budgeted Unit Costs |
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| c. |
Actual Sales Volumes at the Actual Unit Costs |
Which of the following is true?
| a. |
The Static |
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| b. |
The Static Budget Variance for operating income is calculated by taking the actual operating income minus the flexible budget operating income. |
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| c. |
The Static Budget Variance for operating income is calculated by taking the flexible budget operating income minus the actual operating income. |
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