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Flexible budgets provide different information than static budgets. Discuss some of these differences.

Question 1

Review the Standard costs: wake up and smell the coffee. article.  When evaluating performance, many organizations compare current results with the actual results of previous accounting periods. Is an organization that follows this approach likely to encounter any problems? Explain.

Question 2

Flexible budgets provide different information than static budgets. Discuss some of these differences. Is a flexible budget always better? Are there times when you’d recommend using a static budget over a flexible budget?


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