Differences Between the Static Planning Budget and the Flexible Budget

question 62

True/False

Differences between the static planning budget and the flexible budget show what should have happened because the actual level of activity differed from what had been planned.

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Definitions:

Personnel Expenses

Costs associated with the compensation and benefits of a company's employees, including wages, salaries, bonuses, and benefits.

Planning Budget

A budget created for a specific level of activity that is used for planning and coordinating operations.

Budgeting

The process of creating a plan to spend your money, outlining anticipated income and expenses over a certain period.

Activity Variance

The difference between predicted and actual costs of business activities, used to assess performance and control costs.