If the Actual Level of Activity Is Different from the Budgeted

question 32

Multiple Choice

If the actual level of activity is different from the budgeted level, a ________ budget is prepared for the actual level of activity:

• A)continuous
• B)zero-based
• C)master
• D)flexible

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Definitions:

Utilization

The extent to which a resource, such as equipment or labor, is being used effectively to produce goods or services.

Efficiency

The ratio of the output gained from a system to the input used, typically expressed as a percentage indicating performance or productivity.

Expected Monetary Value

A statistical measure used in decision-making under uncertainty, calculating the average outcome when future events have varying monetary values.

Profit

The financial gain achieved when the amount earned from goods or services exceeds the amount spent on their production or provision.