flexible budgeting – NBC Institute

MA – Nov 2024 – L2 – Q3a – Flexible Budget and Variance Analysis

Preparation of a flexible budget and calculation of sales, material, and labour variances.

Question

The budget and actual income statement of Shatta Company PLC for the month of April have been presented in the table below:

	Budget	Actual
Output (production and sales)	10,000	9,000
GH¢	GH¢
Sales Revenue	175,000	162,000
Raw Materials	(80,000) (100,000 meters)	(64,380) (74,000 meters)
Labour	(35,000) (5,000 hours)	(30,960) (4,300 hours)
Fixed Overheads	(35,000)	(36,225)
Operating Profit	25,000	30,435

Required:

i) Prepare a flexible budget for Shatta Company PLC.

ii) Calculate the following variances using the marginal costing system:

Sales (price, volume)
Material (price and usage)
Labour (rate and efficiency)

Answer

Find Related Questions by Tags, levels, etc.

Tags: Cost Control, flexible budgeting, Performance Measurement, Variance Analysis
Level: Level 2

Topic: Standard Costing and Variance Analysis
Series: Nov 2024

MI – May 2024 – L1 – SA – Q5 -Budgeting

Identifies the budgeting process that adjusts costs based on activity levels.

Question

A budgeting process that analyses costs into their fixed and variable elements using the actual activity levels is referred to as:

A. Fixed Budgeting
B. Flexible Budgeting
C. Activity Based Budgeting
D. Zero Based Budgeting
E. Marginal Costing

Answer

Find Related Questions by Tags, levels, etc.

Tags: Budgeting Techniques, Cost Analysis, flexible budgeting, Marginal Costing
Level: Level 1

Topic: Budgeting
Series: MAY 2024

MA – Nov 2018 – L2 – Q2a – Relevant cost and revenue

Discuss the relevance of classifying costs as fixed or variable in decision-making processes, with a focus on their relevance or irrelevance to decisions.

Question

Costs may be classified as fixed or variable. This classification method is useful for decision-making because variable costs are relevant costs whereas fixed costs are irrelevant.

Required:
Explain this statement.

Answer

Find Related Questions by Tags, levels, etc.

Tags: Budgetary Control, flexible budgeting, operating budgets, Sales Variance, Variance Analysis
Level: Level 2

Topic: Relevant Cost and Revenue
Series: NOV 2018

MA – Nov 2024 – L2 – Q3a – Flexible Budget and Variance Analysis

Preparation of a flexible budget and calculation of sales, material, and labour variances.

Question

The budget and actual income statement of Shatta Company PLC for the month of April have been presented in the table below:

	Budget	Actual
Output (production and sales)	10,000	9,000
GH¢	GH¢
Sales Revenue	175,000	162,000
Raw Materials	(80,000) (100,000 meters)	(64,380) (74,000 meters)
Labour	(35,000) (5,000 hours)	(30,960) (4,300 hours)
Fixed Overheads	(35,000)	(36,225)
Operating Profit	25,000	30,435

Required:

i) Prepare a flexible budget for Shatta Company PLC.

ii) Calculate the following variances using the marginal costing system:

Sales (price, volume)
Material (price and usage)
Labour (rate and efficiency)

Answer

Find Related Questions by Tags, levels, etc.

Tags: Cost Control, flexible budgeting, Performance Measurement, Variance Analysis
Level: Level 2

Topic: Standard Costing and Variance Analysis
Series: Nov 2024

MI – May 2024 – L1 – SA – Q5 -Budgeting

Identifies the budgeting process that adjusts costs based on activity levels.

Question

A budgeting process that analyses costs into their fixed and variable elements using the actual activity levels is referred to as:

A. Fixed Budgeting
B. Flexible Budgeting
C. Activity Based Budgeting
D. Zero Based Budgeting
E. Marginal Costing

Answer

Find Related Questions by Tags, levels, etc.

Tags: Budgeting Techniques, Cost Analysis, flexible budgeting, Marginal Costing
Level: Level 1

Topic: Budgeting
Series: MAY 2024

MA – Nov 2018 – L2 – Q2a – Relevant cost and revenue

Discuss the relevance of classifying costs as fixed or variable in decision-making processes, with a focus on their relevance or irrelevance to decisions.

Question

Costs may be classified as fixed or variable. This classification method is useful for decision-making because variable costs are relevant costs whereas fixed costs are irrelevant.

Required:
Explain this statement.

Answer

Find Related Questions by Tags, levels, etc.

Tags: Budgetary Control, flexible budgeting, operating budgets, Sales Variance, Variance Analysis
Level: Level 2

Topic: Relevant Cost and Revenue
Series: NOV 2018

Question Tag: flexible budgeting

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MA – Nov 2024 – L2 – Q3a – Flexible Budget and Variance Analysis

Preparation of a flexible budget and calculation of sales, material, and labour variances.

MI – May 2024 – L1 – SA – Q5 -Budgeting

Identifies the budgeting process that adjusts costs based on activity levels.

MA – Nov 2018 – L2 – Q2a – Relevant cost and revenue

Discuss the relevance of classifying costs as fixed or variable in decision-making processes, with a focus on their relevance or irrelevance to decisions.

MA – Nov 2024 – L2 – Q3a – Flexible Budget and Variance Analysis

Preparation of a flexible budget and calculation of sales, material, and labour variances.

MI – May 2024 – L1 – SA – Q5 -Budgeting

Identifies the budgeting process that adjusts costs based on activity levels.

MA – Nov 2018 – L2 – Q2a – Relevant cost and revenue

Discuss the relevance of classifying costs as fixed or variable in decision-making processes, with a focus on their relevance or irrelevance to decisions.

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Question Tag: flexible budgeting

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MA – Nov 2024 – L2 – Q3a – Flexible Budget and Variance Analysis

Preparation of a flexible budget and calculation of sales, material, and labour variances.

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MI – May 2024 – L1 – SA – Q5 -Budgeting

Identifies the budgeting process that adjusts costs based on activity levels.

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MA – Nov 2018 – L2 – Q2a – Relevant cost and revenue

Discuss the relevance of classifying costs as fixed or variable in decision-making processes, with a focus on their relevance or irrelevance to decisions.

You're reporting an error for "MA – Nov 2018 – L2 – Q2a – Relevant cost and revenue"

MA – Nov 2024 – L2 – Q3a – Flexible Budget and Variance Analysis

Preparation of a flexible budget and calculation of sales, material, and labour variances.

You're reporting an error for "MA – Nov 2024 – L2 – Q3a – Flexible Budget and Variance Analysis"

MI – May 2024 – L1 – SA – Q5 -Budgeting

Identifies the budgeting process that adjusts costs based on activity levels.

You're reporting an error for "MI – May 2024 – L1 – SA – Q5 -Budgeting"

MA – Nov 2018 – L2 – Q2a – Relevant cost and revenue

Discuss the relevance of classifying costs as fixed or variable in decision-making processes, with a focus on their relevance or irrelevance to decisions.

You're reporting an error for "MA – Nov 2018 – L2 – Q2a – Relevant cost and revenue"

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