Choice of budget flexing basis, Cost Accounting

Choice of Budget Flexing Basis

The most suitable flexing basis must be considered where it assists in the comparison of alternative budget data at the planning stage and for the comparison of budget and real data at the control stage.

Various organizations employ various flexing bases however the following are most commonly utilized:

  1. Machine hours
  2. Direct labour hours
  3. Input to a cost centre
  4. Output from a cost centre

For the above specified flexing bases to be utilized a number of requirements must be fulfilled.

1. The flexing bases must be correlated along with the way in which costs vary. As an example of, does the number of miles traveled via distribution vehicles affect the maintenance and repairs expenses?

2. The flexible bases must be easily understood with the management and not subject to manipulation.

3. The flexible bases must be readily obtainable.

4. It must be independent of other factors.

Posted Date: 2/7/2013 4:48:44 AM | Location : United States







Related Discussions:- Choice of budget flexing basis, Assignment Help, Ask Question on Choice of budget flexing basis, Get Answer, Expert's Help, Choice of budget flexing basis Discussions

Write discussion on Choice of budget flexing basis
Your posts are moderated
Related Questions
A college currently measures its performance by comparing the actual costs against its budgeted costs for the year.Now that the college is facing increased competition from Various

A retailer knows the annual demand for one of its product is 100,000 units, the ordering costs are £25 per order and the average carrying cost per unit is 35 pence. You are require

How many pounds of guava puree are required? a. In a month? b. How many in a year? In computing the Total Landed cost for mango concentrate, we are interested in the incre

Evaluate the discounted mean term (DMT) of a bond redeemable at $120 nominal in 15 years time with annual coupons of 7% (based on a nominal bond of $100) at interest rates of 6% ,

distinguish between bin card and store ledgre

The following is a summary of a cash book for the year ended 31 April 2012 Payments                              $              Receipts                                    $

Valuation of Work In Progress The concept of Equivalent units It is a notional quantity of completed goods in the production process. This is a collection of work applic

The Integrated Management Project is to be based on an organisation, a strategic business unit, or profit centre that has good potential for growth and development. The brief is to

contract account formate

The principle that (1) requires revenue to be recognized at the time it is earned, (2) allows the inflow of assets associated with revenue to be in a form other than cash and (3) m