Kilroy Manufacturing prepared a 2020 budget for 40,000 units of product.Actual production in 2020 was 41,000 units.Which one of the following is the most useful comparison for this company?

Question

Quizplus · Accepted Answer

The most useful comparison would be to compare the actual results for 41,000 units with the original budget for 40,000 units. This will show the variance between the actual results and the plan that was originally set. Comparing to a new budget for 41,000 units would not be as useful because it would be a revised plan and not the original plan that was set. Comparing to the previous year's actual results for 44,000 units would not be as useful because it is not a direct comparison to the current year's actual results for 41,000 units.

Kilroy Manufacturing Prepared a 2020 Budget for 40,000 Units of Product.Actual