8-Flexible-Budgets-and-Variance-Analysis(上财-管理会计).pdf

Introduction to Management Accounting Chapter 8 Flexible Budgets and Variance Analysis Chapter 8 Learning Objectives When you have finished studying this chapter, you should be able to: 1. Distinguish between flexible budgets and static budgets. 2. Use flexible-budget formulas to construct a flexible budget based on the volume of sales. 3. Prepare an activity-based flexible budget. 4. Explain the performance evaluation relationship between static budgets, flexible budgets, and actual results. Chapter 8 Learning Objectives 5. Compute activity-level variances and flexible- budget variances. 6. Compute and interpret price and quantity variances for materials and labor. 7. Compute variable overhead spending and efficiency variances. 8. Compute the fixed-overhead spending variance. Favorable and Unfavorable Variances Favorable variances arise when actual results exceed budgeted. Unfavorable variances arise when actual results fall below budgeted. Favorable (F) versus Unfavorable (U) Variances Profit Revenue Costs Actual > Expected F F U Actual < Expected U U F Learning Static and Flexible Budgets Objective 1 A static budget is prepared for only one level of a given type of activity. Differences between actual results and the static budget for level of output achieved are static-budget variances. Static and Flexible Budgets A flexible budget (variable budget) adjusts for different levels of activities. Differences between actual results and the flexible budget are flexible-budget variances. Learning Flexible Budget Formulas Objective 2 To develop a f