Directly comparing static budget costs to actual costs only makes sense if the costs are variable.

Name: Directly comparing static budget costs to actual costs only makes sense if the costs are variable.
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Question

Quizplus · Accepted Answer

Directly comparing static budget costs to actual costs can be misleading if the costs are not purely variable. Fixed costs, such as rent or salaries, will not change based on actual activity levels and should be evaluated separately from variable costs when analyzing budget variances.

Directly Comparing Static Budget Costs to Actual Costs Only Makes