In a flexible budget for a profit center,which of the following items would not be expected to vary with the level of activity?
A)Revenue
B)Fixed manufacturing overhead
C)Direct materials cost
D)Variable manufacturing overhead

Question

Quizplus · Accepted Answer

Fixed manufacturing overhead is not expected to vary with the level of activity as it is a fixed cost that does not change with changes in production volume. Direct materials cost and variable manufacturing overhead are expected to vary with the level of activity as they are dependent on the amount of materials and production required. Revenue is also expected to vary with the level of activity as it depends on the quantity of products sold.

In a Flexible Budget for a Profit Center,which of the Following