What Is the Primary Difference Between a Fixed Budget and a Flexible

question 79

Multiple Choice

What is the primary difference between a fixed budget and a flexible budget?

• A)A fixed budget includes only fixed costs,while a flexible budget includes only variable costs.
• B)A fixed budget is concerned only with future acquisitions of fixed assets,while a flexible budget is concerned with expenses,which vary with sales.
• C)A fixed budget cannot be changed after the period begins,while a flexible budget can be changed after the period begins.
• D)A fixed budget is a plan for a single level of sales (or other measure of activity),while a flexible budget consists of several plans,one for each of several levels of sales (or other measure of activity).

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Definitions:

One-way ANOVA

A statistical test used to determine if there are statistically significant differences between the means of three or more independent (unrelated) groups based on one independent variable.

F-ratio

A statistical measure used in analysis of variance (ANOVA) to determine the degree of variation between sample means in comparison to variation within the samples.

Critical Value

A point on the test distribution that is compared to the test statistic to decide whether to reject the null hypothesis.

Degrees of Freedom

Refers to the number of independent values or quantities which can be assigned to a statistical distribution or a statistical test.