An after-the-fact flexible budget:
A) is useful for control.
B) is used to provide the expected cost for a range of activity levels.
C) is used only when the actual level of activity is the same as the static budget level of activity.
D) is the key to receiving frequent feedback from customers.
E) All of these are correct.

Question

Quizplus · Accepted Answer

An after-the-fact flexible budget is useful for control as it helps in comparing the actual results with the flexible budget and identifying the deviations. Option B is incorrect because a flexible budget is prepared in advance to provide the expected cost for a range of activity levels. Option C is incorrect because an after-the-fact flexible budget is prepared after the actual level of activity has occurred, and it can be compared to the actual results achieved. Option D is incorrect as it is not related to a flexible budget. Therefore, the correct answer is A.

An After-The-Fact Flexible Budget