A company's actual performance should be compared against budgeted rather than actual amounts for the same accounting period so that:

Question

Quizplus · Accepted Answer

Comparing actual performance against budgeted amounts for the same accounting period allows for adjustments to be made based on expected changes in future conditions. This allows for a more accurate assessment of performance and can help in planning for future periods. Option A is incorrect because feedback is necessary for improvement. Option B is incorrect because a rolling budget is not relevant to the question. Option D is incorrect because including inefficiencies from the past year would not be useful in planning for future periods.

A Company's Actual Performance Should Be Compared Against Budgeted Rather