A Before-The-Fact Flexible Budget

question 56

Multiple Choice

A before-the-fact flexible budget

• A)calculates expected costs for various levels of activity.
• B)allows managers to deal with uncertainty.
• C)can be used to generate results for a number of plausible scenarios.
• D)is a useful planning tool.
• E)all of these.

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Definitions:

Retain Earnings

Profits that a company keeps after dividends have been paid out to shareholders, often used for reinvestment in the business.

Dividends

Distributions of earnings given by a company to its stockholders, typically from the profits made.

Labor Supply Curves

Graphical representation showing the relationship between different wage levels and the quantity of labor workers are willing to supply, generally sloping upwards indicating that higher wages attract more labor.

Movements of Workers

Refers to the geographical or occupational mobility of labor, which includes migration or changes in jobs within or across industries.