QUESTION 1 10 points Save Answer Signify TRUE or FALSE as applicable next to eac

Question

QUESTION 1 10 points Save Answer Signify TRUE or FALSE as applicable next to each of the following items as they pertain to flexible budgets. If actual volume differs from static budget volume, total A. True variable costs per the flexible budget will differ from the p static budget (assume we stay within the relevant range) If actual volume differs from static budget volume, total fixed costs per the flexible budget will differ from the static budget (assume we stay within the relevant range) Total variable costs per the flexible budget reflect actual variable cost per unit. Total variable costs per the flexible budget reflect actual volume. Total fixed costs per the flexible budget reflect static budget fixed cost per unit multiplied by actual volume

Explanation / Answer

1. True

Variable costs will differ per the volumes and hence if the actual volume which is used for the flexible budget differs from the static budget volume, the total variable costs per the flexible budget will differ from the static budget.

2. False

The total fixed costs per the flexible budget will be the same as the total fixed costs per the static budget when the volumes are within the relevant range.

3. False

Total variable costs per the flexible budget reflect the budgeted variable cost per unit for actual volume.

4. True

The flexible budget is prepared for actual volume at budgeted rates and hence total variable costs per the flexible budget reflects actual volume.

5. False

Total fixed costs per the flexible budget reflect the total fixed costs per the static budget when the volumes are within the relevant range.

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