What is the primary difference between a fixed budget and a flexible budget?
A)A fixed budget includes only fixed costs,while a flexible budget includes only variable costs.
B)A fixed budget is concerned only with future acquisitions of fixed assets,while a flexible budget is concerned with expenses,which vary with sales.
C)A fixed budget cannot be changed after the period begins,while a flexible budget can be changed after the period begins.
D)A fixed budget is a plan for a single level of sales (or other measure of activity),while a flexible budget consists of several plans,one for each of several levels of sales (or other measure of activity).

Question

Quizplus · Accepted Answer

The primary difference between a fixed budget and a flexible budget is that a fixed budget is a plan for a single level of sales (or other measure of activity), while a flexible budget consists of several plans, one for each of several levels of sales (or other measure of activity). Additionally, a fixed budget cannot be changed after the period begins, while a flexible budget can be adjusted as needed throughout the period. Therefore, choice D is the best answer.

What Is the Primary Difference Between a Fixed Budget and a Flexible