In developing a flexible budget within a relevant range of activity,

a. only fixed costs are included.

b. it is necessary to prepare a budget at 1,000 unit increments.

c. variable and fixed costs are combined and are reported as a total cost.

d. it is necessary to relate variable cost data to the activity index chosen.

Question

Business

Hamlet

1 June, 03:15

In developing a flexible budget within a relevant range of activity,

a. only fixed costs are included.

b. it is necessary to prepare a budget at 1,000 unit increments.

c. variable and fixed costs are combined and are reported as a total cost.

d. it is necessary to relate variable cost data to the activity index chosen.

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Answers (1)

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Braylen Lin · Answer 1

Answer: d. it is necessary to relate variable cost data to the activity index chosen

Explanation:

The activity index shows how various activities have an impact on the cost of production.

When developing a flexible budget within a relevant range of activity, ome must relate variable cost data to the activity index chosen to ensure that it is indeed variable.