Budgeting Question:
Download Job Interview Questions and Answers PDF
Explain the difference between fixed and flexible budgets?
Answer:
1. A fixed budget is established for a specific level of activity whereas flexible budget is prepared for various levels of activity.
2. Fixed budget cannot be changed after the period commences, whereas a flexible budget can be changed after the period commence.
3. Fixed budget is more suitable for fixed expenses whereas flexible budget takes both fixed as well as variable expenses in account.
4. Fixed budget includes only fixed costs, whereas a flexible budget includes fixed costs, variable costs and semi variable costs.
5. Fixed budget is mainly used in planning stage whereas flexible budget is used in controlling stage.
2. Fixed budget cannot be changed after the period commences, whereas a flexible budget can be changed after the period commence.
3. Fixed budget is more suitable for fixed expenses whereas flexible budget takes both fixed as well as variable expenses in account.
4. Fixed budget includes only fixed costs, whereas a flexible budget includes fixed costs, variable costs and semi variable costs.
5. Fixed budget is mainly used in planning stage whereas flexible budget is used in controlling stage.
Download Budgeting Interview Questions And Answers
PDF
| Previous Question | Next Question |
| Which methods are used to prepare cash budget? | Which budgets are prepared under the production budget? |