Chapter 10 power point notes Braun2e

Chapter 10 power point notes Braun2e - ChapterTen...

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ACG 2071 - Spring 2011 1 Chapter Ten Flexible Budgets and Standard  Costs 
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ACG 2071 - Spring 2011 2 Static vs. Flexible Budgets Static Budgets  are budgets prepared for one  planned level of activity and sales volume.  Once a  static budget is prepared it does not change. Flexible Budgets  are budgets that are adjusted for  different levels of activity and sales volume.   Sometimes they are prepared based on a range of  activity (more than one budget is prepared) and  sometimes they are prepared “after the fact” as a  budget based on  actual  activity and sales volume.
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ACG 2071 - Spring 2011 3 Variances Variances    are differences between budget (or  standard) amounts and actual amounts Sales Volume Variances    are differences between  a static budget and a flexible budget based on  actual number of outputs. Flexible Budget Variances   are differences  between the flexible budget and the actual results.  This eliminates variances caused by volume  differences.
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Chapter 10 power point notes Braun2e - ChapterTen...

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