A flexible-budget variance measures the impact on short-term operating profit of:
A) Changes in sales volume.
B) Changes in output during the period.
C) Differences in sales mix—budgeted versus actual.
D) Selling price and cost differences—actual versus budgeted.
E) Selling price, but not cost, differences—actual versus budgeted.

Question

Quizplus · Accepted Answer

A flexible-budget variance measures the difference between the actual results and the expected performance (budgeted amounts) based on the actual level of output, including both selling price and cost differences.

A Flexible-Budget Variance Measures the Impact on Short-Term Operating Profit