Question

Match each term to the correct definition. ​Terms: a. Flexible budget b. Flexible budget variance c. Sales volume variance d. Static budget e. Variance ​Definitions: ▼ a. b. c. d. e. 1. A summarized budget for several levels of volume that separates variable costs from fixed costs. ▼ a. b. c. d. e. 2. A budget prepared for only one level of sales. ▼ a. b. c. d. e. 3. The difference between an actual amount and the budgeted amount. ▼ a. b. c. d. e. 4. The difference arising because the company actually earned more or less​ revenue, or incurred more or less​ cost, than expected for the actual level of output. ▼ a. b. c. d. e. 5. The difference arising only because the number of units actually sold differs from the static budget units.

Answer 1

1. Flexible budget: A summarized budget for several levels of volume that separates variable costs from fixed costs. ▼ a.

2. Static budget: A budget prepared for only one level of sales. ▼ d.

3. Variance: The difference between an actual amount and the budgeted amount. ▼ e.

4. Flexible budget variance: The difference arising because the company actually earned more or less​ revenue, or incurred more or less​ cost, than expected for the actual level of output. ▼ b.

5. Sales volume variance: The difference arising only because the number of units actually sold differs from the static budget units. ▼ c.