Chapter 9, Problem 5E

To determine

Concept Introduction:

Flexible Budget: The budget made to recognize the difference between fixed, semi-variable, and variable costs in accordance with the change in the level of activity attained is stated as a flexible budget. In order to prepare flexible costs, the first essential step is to segregate the cost into three categories; fixed costs, semi-variable, and variable costs. Fixed cost remains the same irrespective of the activity level. Variable cost and semi-variable changes as per the change in the activity level.

To Prepare: The flexible budget for the A Tours.