An after-the-fact flexible budget
A) is a budget for the actual level of activity.
B) is used for performance reports.
C) calculates what costs should have been for the actual level of activity.
D) is used to compare expected costs with actual costs.
E) All of these.

Question

Quizplus · Accepted Answer

An after-the-fact flexible budget is designed to reflect what the budget should have been for the actual level of activity achieved. It is used for performance evaluation by comparing these adjusted budget figures (what costs should have been) with the actual costs incurred. This makes it a tool for both planning and control, hence all the options (A, B, C, D) correctly describe aspects of an after-the-fact flexible budget.

An After-The-Fact Flexible Budget