In a Flexible Budget ________

question 41

Multiple Choice

In a flexible budget ________.

• A) variable costs are calculated proportionately for the budgeted level of sales
• B) fixed costs are calculated proportionately for the actual level of sales
• C) fixed costs are kept at the same level of static budget
• D) variable costs are kept at the same level of static budget

---

Definitions:

Operating Cash Flow

This measures the cash generated by a company's normal business operations, indicating whether it is capable of maintaining and growing its operations.

Depreciation

The accounting process of allocating the cost of a tangible asset over its useful life, reflecting wear and tear or obsolescence.

Tax Rate

The percentage at which an individual or corporation is taxed by the government on their income or profits.

Net Working Capital

The difference between a company's current assets and current liabilities, indicating its operational liquidity.