Under-estimating production levels will likely lead to:
A) Unfavorable static budget variances
B) Unfavorable flexible budget variances
C) Favorable flexible budget variances
D) Favorable static budget variances
E) None of the above

Question

Quizplus · Accepted Answer

Under-estimating production levels can lead to unfavorable static budget variances because the actual production exceeds the budgeted production, resulting in higher costs than anticipated in the static budget.

Under-Estimating Production Levels Will Likely Lead To