Which of the following statements is true concerning the flexible budget?
A)The flexible budget shows the expected relation between costs and volume.
B)The flexible budget has a fixed cost component which is expected to be incurred regardless of the level of activity.
C)The flexible budget has a variable cost per unit of activity component where variable costs change in total as the level of activity changes.
D)all of the above.

Question

Quizplus · Accepted Answer

A) The flexible budget shows the expected relationship between costs and volume. This is true as the flexible budget adjusts the costs based on the actual level of activity.
B) The flexible budget does not have a fixed cost component, as it adjusts both fixed and variable costs based on the actual level of activity.
C) The flexible budget has a variable cost per unit of activity component, where variable costs change in total as the level of activity changes. This is also true as variable costs are adjusted based on the actual level of activity. 
Therefore, all of the statements are true concerning the flexible budget.

Which of the Following Statements Is True Concerning the Flexible