Flexible budgeting - Revision history

imported>Doug Williamson: Classify page.

2022-04-30T15:53:51Z

Classify page.

← Older revision		Revision as of 15:53, 30 April 2022
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	* [[Variance]]		* [[Variance]]
	* [[Zero based budgeting]]		* [[Zero based budgeting]]

			[[Category:The_business_context]]
			[[Category:Identify_and_assess_risks]]
			[[Category:Manage_risks]]

imported>Doug Williamson: Spacing 27/8/13

2013-08-27T13:57:22Z

Spacing 27/8/13

← Older revision		Revision as of 13:57, 27 August 2013
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	Actual fixed costs should be the same as budgeted, regardless of changes in sales levels – only the variable costs should change.		Actual fixed costs should be the same as budgeted, regardless of changes in sales levels – only the variable costs should change.

	It is essential that actual costs and revenues are compared with planned amounts. However, to make the comparison meaningful, it is essential to adjust the variable cost element of the budget to reflect the actual activity levels. This process is referred to as ‘flexing the budget’.		It is essential that actual costs and revenues are compared with planned amounts.

			However, to make the comparison meaningful, it is essential to adjust the variable cost element of the budget to reflect the actual activity levels.

			This process is referred to as ‘flexing the budget’.


	== See also ==		== See also ==
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	* [[Variance]]		* [[Variance]]
	* [[Zero based budgeting]]		* [[Zero based budgeting]]

imported>Administrator: CSV import

2012-10-23T14:19:39Z

CSV import

New page

A comparison of budgeted costs at the budgeted activity level with actual costs at the actual activity level is meaningless if there is a significant difference between budgeted and actual activity levels.

If actual costs are dramatically higher than budget, it does not necessarily mean that costs are out of control, if sales levels are dramatically higher than planned.

Actual fixed costs should be the same as budgeted, regardless of changes in sales levels – only the variable costs should change.

It is essential that actual costs and revenues are compared with planned amounts. However, to make the comparison meaningful, it is essential to adjust the variable cost element of the budget to reflect the actual activity levels. This process is referred to as ‘flexing the budget’.

== See also ==
* [[Fixed cost]]
* [[Variable cost]]
* [[Variance]]
* [[Zero based budgeting]]