Accounting

Flexible Budgets and Cost Variances: Please respond to one of the following:

Option 1

Suggest how management can use the real-time variance data analysis to improve operations. Evaluate the potential risk that management may encounter by relying on the real-time data, without further investigation.

Option 2

What are the reasons to use a flexible budget? What is the major distinction between a static budget and a flexible budget? Illustrate the difference using a real-world example.

Option 3

Suggest how management can utilize variance analysis in improving the efficiency of activities during the manufacturing process.