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    static budget versus a flexible budget

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    Why do you think companies make the mistake of only paying close attention to the static budget? Is it just not wanting to spend the time and money? Or do you think it they are unaware of the importance of the flexible budget?

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    Solution Preview

    Budget is a comprehensive financial plan of allocation of financial resources. Budgeting helps in booth planning and controlling the activities of the organization. It is a useful communication tool. There are two types of budget flexible budget and static budget. Each has its own pros and cons. Static budget does not change with changes in activity level but on the other hand, Flexible budget changes with change in the activity level. As per wiki answers "Static budget is a ...

    Solution Summary

    The response tells about the difference between static budget versus a flexible budget.