If a Static Budget Forecasted 100,000 Units to Be Sold

question 132

Multiple Choice

If a static budget forecasted 100,000 units to be sold in the fiscal year and actual units sold amounted to 120,000, what assumption could be made under a flexible budget process?

• A)Since the actual volume exceeds the budgeted volume, there is an unfavorable volume variance for output.
• B)Fixed costs would increase in the flexible budget due to the volume change.
• C)The effectiveness of the manager is in question.
• D)Variable costs will be higher than projected in the static budget due to the volume variance.

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Definitions:

Marketing Mix

A set of marketing tools that a firm uses to pursue its marketing objectives in the target market, traditionally identified as product, price, place, and promotion.

Four Ps

Stands for Product, Price, Place, and Promotion, which are the core elements involved in marketing a product or service.

Marketing Mix

A blend of marketing variables, typically known as the 4Ps (Product, Price, Place, Promotion), used by businesses to achieve their marketing objectives and satisfy customer needs.

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