Ch2 Flashcards
Special Order Decisions
EXCESS CAPACITY
Accept only if:
Selling price/unit is > VC/unit (relevant costs)
Special Order Decisions
FULL CAPACITY
If company is operation at full capacity, OPPORTUNITY COST is taken into consideration.
Accept only if
Selling price> VC/unit(relevant costs)+Opportunity costs/unit
Formula for Opportunity cost/unit:
CM in $/Size of special order
TARGET COSTING
TARGET COST= Market price-Required Profit
*Markert price/Sales price= Profit+Cost
TO MAXIMIZE PROFIT AT FULL CAPACITY
CM is a better measure because it includes all VC
CURRENT RATIO
A company wants a ration greater than 1
A ration of at least 1 means that current assets>greater than current liabilities
ASSUMPTIONS UNDERLYING COST-VOLUME-PROFIT ANALYSIS INCLUDE
- All costs can be divided into fixed and variable elements.
- Volume is the only relevant factor affect cost.
- All costs behave in a linear fashion in relation to production volume.
- Cost behaviors are anticipated to remain constant over the relevant range of production volume because of the assumption of production does not change
- Costs show greater variability over time. The longer the period, the greater the % of VC. The shorter the period the greater % of FC
DELPHI FORECASTING METHOD
Relies mostly on judgement. This method involves the use of multiple teams in geographically remote locations. information is shared and gathered in a central point and compiled and then redistributed for comment. This method is highly interpersonal and requires significant judgement.
AN INCREASE IN PRODUCTION WITHIN A RELEVANT RANGE MOST LIKELY WOULD RESULT IN
An increase in production levels within the the relevant range would likely cause VC to increase. While FC in total would remain constant (FC/unit will decrease) therefore total costs would increase.
WHICH OF THE FOLLOWING METHODS WILL YIELD THE LOWEST INVENTORY VALUE?
- Variable
- Absorption
- Process
- Hybrid
Variable
Variable costing typically produces the lowest inventory value since only VC are capitalized. Other methodologies of inventory accounting will account for FC in inventory in greater values than VC.
WHEN USING A COEFFICIENT OF CORRELATION TO MEASURE STRENGTH OF CVR WHAT COEFFICIENT MOST LIKELY IS GONNA BE FOUND WHEN REVIEWING VC AND VOLUME?
Coefficient of Correlation of +1
because of the strong relationship assumed in CVP analysis where Total VC increased proportionally with volume
WHAT IS MOST USEFUL WHEN RISK IS BEING PRIORITIZED?
Expected Value
because it assigns probabilities to potential outcomes quantify both the likelihood (%) and outcome (amounts) into a single value.
TACTICAL PLANNING
IS ALSO KNOW AS?
Tactical plans are also called single-used plans because they are developed to apply to specific circumstances during a specific time frame. Usually short term up to 18 months.
WHAT IS AN ANNUAL BUDGET
Is a type of single use tactical plan. Budgets translate the strategic plan and implementation into a period-specified operational guide.
Placing responsibility for achievement of strategic goals in the hands of managers promotes routine accomplishment of strategy as part of managers job function.
WHAT IS OPERATIONAL AND TACTICAL PLANNING?
Operational and tactical planning is the process of determining the specific objectives and means by which strategic plans will be achieved.
Tactical plans are short term and cover periods up to 18 months.
BUDGET POLICIES SHOULD INCLUDE?
To effectively budget, an organization should implement formal budget policies that include:
- Managements participation
- Budget guidelines.
- based on the entities strategic goals and long term plan.
What are Ideal Standards?
Represents the costs that result from perfect efficiency and effectiveness in job performance. They are forward looking and no provision is made for spoilage or downtime.
Advantage of Ideal Standards?
Implied emphasis on continuous quality improvement (CQI) to meet ideal.
Disadvantages of Ideal Standards?
Demotivation of employees by the use of unattainable standards and the inability to use standards in standard COGS.
WHAT ARE CURRENTLY ATTAINABLE STANDARDS?
Represents costs that result from work performed by employees with appropriate training and experience but without extraordinary effort. provisions are made for normal spoilage and downtime.
ADVANTAGE OF CURRENTLY ATTAINABLE STANDARDS?
They are reasonable standards.
DISADVANTAGE OF CURRENTLY ATTAINABLE STANDARDS?
Require use of judgment and potential manipulation.
AUTHORITATIVE STANDARDS
The are set exclusively by management.
they can be implemented quickly and will likely include all costs but workers might not accept imposed standards.
PARTICIPATIVE STANDARDS
Are set by both managers and individuals who are held accountable to those standards. workers are more likely to accept participative standards but they are slower to implement.
MASTER BUDGET
A master budget or annual business plan documents short term operating performance goals for a period, normally one yr or less. The plan normally includes an operating (non financial) budget and a financial budget that outlines sources of funds and detailed plans for their expenditure.
WHAT ARE MASTER BUDGETS COMPONENTS?
A master budget generally comprises operating budgets and financial budgets peppered in anticipation of achieving single level of sales volume for a specified period.
LIMITATIONS OF THE ANNUAL PLAN-MASTER BUDGET?
Master budgetconfined to one year at a single level activity.
Reporting Output-the product of the process is a set of pro forma F/S. Although familiar, pro forma F/S may not provide the type of management info most useful to decision making.
MASTER BUDGET-OPERATIN BUDGETS
They are established to describe the resources (DM,DL) needed and the manner in which those resources will be acquired. They include: Sales budget Production Budget Selling and Admin Personnel budgets
MASTER BUDGET-FINANCIAL BUDGETS
Financial budgets define detail sources and uses of funds to be used in operations. They include: Pro forma FS -BS -IS -Cash Flows -Cash budgets
OPERATING BUDGETS-SALES BUDGET
Sales budget is the foundation of the entire budget process. It is the first budget prepared and it drives development of most other components of the master budget. It drives the anticipated cash and revenue figures.
SALES BUDGET INFO
Based on sales forecast which are derived from input received from numerous organizational resources including opines of sales staff, statistical analysis between sales and economic indicators and opinions of line management.
SALES FORECAST ARE DEVELOPED AFTER CONSIDERATIONS OF THE FOLLOWING FACTORS
Past patters of sales Sales force estimates General economic conditions Competitors actions Changes in the firms prices Changes in product mix Results of Market research studies Advertising and sales promo plans
OPERATING BUDGETS-PRODUCTION BUDGETS
Production inventory budgets are prepared for each product or each department based on the amount that will be produced, stated in units.
It is made up of the amounts spent for DL, DM and OVHD. The amount of production budget is based on the amounts of inventory on hand and the inventory necessary to sustain sales.
FINANCIAL BUDGETS-CASH BUDGETS
Cash budgets represent detailed projections of cash receipts and disbursements. This budget is derived from other budgets based on cash collection and disbursement assumptions.
WHAT ARE THE 3 MAJOR SECTIONS OF CASH BUDGETS?
Cash available, cash disbursements, financing.
CASH BUDGET FORMATS
Cash budget represents statements of planned cash receipts and disbursements and are primarily affected by the amounts used in the budgeted IS cash budgets consider:
beginning cash
cash collections from sales (add)
cash disbursements fro purchases and operating expenses (subtract)
computed ending cash
cash requirements to sustain operations (subtract)
Working capital loans to maintain cash requirements
VARIANCE ANALYSIS USING STANDARDS
STANDARD COSTING SYSTEMS
Standard costing system are the most common cost-measuremnt systems. In the aggregate, measure costs the firm expects it should incur during production. In a standard costs system, standard costs are used for all manufacturing costs.
STANDARD COST OBJECTIVES
To attain a realistic predetermined or budgeted costs for use in planning and decision making.
EVALUATING VARIANCE FROM STANDARDS
The difference between actual and stander amounts are called variances.
CONTROLLABLE VARIANCE
if a variance from standard could’ve been prevented is called a controllable variance. It usually includes
DM
DL
VOH
UNCONTROLLABLE VARIANCE
Is when a variance from standard cannot be controlled. For example
Most fixed costs
DM PRICE VARIANCE
AQ*(AP-SP)
DM QUANTITY USAGE VARIANCE
SP*(AQU-SQ ALLOWED)
DL RATE VARIANCE
AH WORKED*(ACTUAL RATE-STANDARD RATE)
DL EFFICIENCY VARIANCE
S.RATE*(ACTUAL HRS WORKED-S.HOURS ALLOWED)
DESIRED INCREASE IN FINISHED GOODS
MEANS A DESIRE INCREASE IN INVENTORY
BASIC DIFFERENCE BETWEEN A MASTER BUDGET AND FLEXIBLE BUDGET IS THAT A MASTER BUDGET IS…
Based on one specific level of production and a flexible budget can be prepared for any production level within a relevant range.
WHAT IS A MASTER BUDGET?
A master budget issn overall budget, consisting of many smaller budgets, that is based one specific level of production.
WHAT IS A FLEXIBLE BUDGET?
Is a series of budgets based on different activity levels within the relevant range
ESTIMATED PRODUCTION FORMULA
BUDGETED SALES
+ DESIRED ENDING INVENTORY
- BEGINNING INVENTORY
=BUDGETED PRODUCTION
UNITS OF DM TO BE PURCHASED FOR THE PERIOD
UNITS OF DM NEEDED FOR A PRODUCTION PERIOD
+ DESIRED ENDING INVENTORY AT THE END OF PERIOD
- BEGINNING INVENTORY AT THE START OF THE PERIOD
=UNITS OF DM TO BE PURCHASED FOR THE PERIOD
COST OF DM TO BE PURCHASED FOR THE PERIOD
UNITS OF DM TO BE PURCHASED
* COST PER UNIT
=COST OF DM TO BE PURCHASED FOR THE PERIOD
DIRECT MATERIALS USAGE BUDGET
BEGINNING INVENTORY AT COST
+ PURCHASE AT COST
- ENDING INVENTORY AT COST
=DIRECT MATERIAL USAGE (COST OF MATERIALS USED)
DL BUDGET-DRIVEN BY PRODUCTION
BUDGET PRODUCTION IN UNITS * HRS REQUIRED TO PRODUCED EACH UNIT = TOTAL # OF HOURS NEEDED * HOURLY WAGE RATE. =TOTAL WAGES
FLEXIBLE BUDGET
Is a budget prepared at different levels of operating activity. it is appropriate for any activity that has VC. It is not necessary for the contra of FC since FC do not vary with changes in the level of activity.
STRATEGIC BUSINESS UNITS (SBU) ARE CLASSIFIED INTO DIFFERENT TYPES BASED ON THE RESPONSIBILITY LEVELS ASSIGNED TO THEIR MANAGERS. WHICH SBU HAS THE LEAST AMOUNT OF RESPONSIBILITY?
-Cost SBU
Managers in a cost SBU only have responsibility for one dimension of financial performance and it is one that they control entirely, the level of costs incurred.
BALANCE SCORECARD
Is a performance measurement tool generally associated with the display of info evaluating multiple dimensions of business outcomes.
THERE IS NO SINGLE FORMAT FOR THE BALANCED SCORECARD, THE REPORT GENERALLY INCLUDES A VARITY OF MEASUREMENTS ASSOCIATED WITH OBJECTIVES CLASSIFIED BY CRITICAL SUCCES FACTORS. CRITICAL SUCCES FACTORS OFTEN INCLUDE?
The balanced scorecard reports management info regarding organizational performance as defined by critical success factors. These critical success factors are often classified as:
HR
Business process
Customer satisfaction
Financial performance
to demonstrate that no single dimension of organizational performance can be relied upon to evaluate success.
DECENTRALIZED FIRMS CAN DELEGATE AUTHORITY YET RETAIN CONTROL AND MONITOR MANAGERS PERFORMANCE BY STRUCTURING THE ORGANIZATION INTO RESPONSIBILITY CENTERS. WHICH OF THE FOLLOWING ORGANIZATIONAL SEGMENtS IS MOST LIKELY AND INDEPENDENT BUSINESS ?
- An investment center.
- An investment center is most like an independent business. Investment centers are responsible for revenues, expenses, and invested capital.
THE GOALS AND OBJECTIVES UPON WHICH AN ANNUAL PROFIT PLAN IS MOST EFFECTIVELY BASED ARE?
A combination of financial , quantitative and qualititative measures.
The goals and objectives upon which an annual profit plan
also know as budgeted, targeted or estimated FS) is most effectively based are a combination of financial, quantitative (#of units) and qualitative (best) measures. Not all goals and objectives can be quantified.
ORGANIZATIONS FOCUS ON BOTH FINANCIAL AND NON FINANCIAL FEATURES OF THEIR OPERATIONS TO EVALUATE THE DEGREE TO WHICH THEY WILL BE SUCCESSFUL IN THEIR STRATEGIES. THESE FINANCIAL AND NON FINANCIAL DIMENSIONS OF THEIR OPERATIONS ARE SOMETIMES REFERRED TO AS:
CRITICAL SUCCESS FACTORS They are normally classified as: -Financial solvency and return -Customer satisfaction -The total Quality management continuum -Benchmarks
BALANCE SCORECARDS
They serve to document measurements of critical success factors. Although balanced scorecards include measurements that are classified by critical success factors, they are not, themselves, the features of the organization that contributes to its success.
BENCHMARKS
Represent the best practices within an industry or within a function. They may serve as the individual standards that serve to evaluate the achievement of goals classified within the context of critical success factors but they are not themselves, the features that an organizations must posses to accomplish their strategy.
PERFORMANCE REPORSTS SHOULD BE FORMATTED AND DESIGNED TO MEET ORGANIZATIONAL NEEDS. IN THIS REGARD, PERFORMANCE REPORTS NORMALLY INCLUDE ALL OF THE FOLLOWING EXCEPT:
- STRATEGIC PLANS because they are broad-based and long-term in nature. A performance report would not include strategic plans.
- Performance reports are much more specific and shorter term, they would include things such as:
- A user focus
- Exceptional items that are controllable
- Specific time horizons.
STRATEGIC BUSINESS UNITS (SBUS) ARE CLASSIFIED INTO DIFFERENT TYPES BASED ON THE RESPONSIBILITY LEVELS ASSIGNED TO THEIR MANAGERS. EACH OF THE FOLLOWING ITEMS ARE REASONS FOR CLASSIFYING BUSINESS UNITS AS COST, REVENUE, PROFIT OR INVESTMENT EXCEPT TO:
Highlight different responsibility levels among managers in a highly centralized organizations.
SBUs are established in a DECENTRALIZED ENVIRONMENT not a centralized environment. Highlighting different responsibilities levels in centralized environments is not a reason for using cost, revenue, profit and investment SBUs.
PRODUCTION BUDGET
It is calculated from the desired ending inventory and the sales forecast.
The production budget is based on the sales budget (or forecast) with modification for increases or decreases in inventory levels.
SELLING AND ADMINISTRATIVE BUDGETS
Selling and admin budgets, like any budgets, need to be detailed in order that the key assumption are better understood.
A FIRM DEVELOPS AN ANNUAL CASH BUDGET IN ORDER TO
Avoid the opportunity costs of non invested excess cash and minimize the cost of interim financing.
THE CASH BUDGET PROVIDES MANAGEMENT WITH INFO. WHICH OF THE FOLLOWING IS NOT AN EXAMPLE OF INFO A CASH BUDGET PROVIDES?
The need for internal financing.
The cash budget provides info concerning the need for external financing, not internal.
THE CASH BUDGET MUST BE PREPARED BEFORE YOU CAN COMPLETE THE:
Forecasted Balance Sheet
THE FINANCIAL BUDGET PROCESS INCLUDES?
- CASH AND CAPITAL PURCHASES BUDGTES
2. BALANCE SHEET AND STATEMENT OF CASH FLOWS
THE OPERATING BUDGET INCLUDES
- ALL BUDGETS EXCEPT CASH AND CAPITAL PURCHASES.
2. PRO FORMA INCOME STATEMENT
THE BUDGETING PROCESS USUALLY BEGIS WITH?
SALES BUDGET
WHICH ONE IS THE LAST SCHEDULE TO BE PREPARED IN NORMAL BUDGET PREPARATION PROCESS
CASH BUDGET-
SOMETIMES PRO FORMA ACCRUAL FINANCIAL STATEMENTS ARE PREPARED AFTER THIS LAST SCHEDULE.
WHAT IS THE MAIN DIFFERENCE BETWEEN FLEXIBLE BUDGET AND A STATIC BUDGET?
A FLEXIBLE BUDGET PROVIDES COST ALLOWANCES FOR DIFFERENT LEVELS OF ACTIVITY WHEREAS A STATIC BUDGET PROVIDES COST FOR ONE LEVEL OF ACTIVITY.
IN GENERAL, THE PURCHASING MANAGER IS HELD RESPONSIBLE FOR UNFAVORABLE MATERIAL PRICE VARIANCES. CAUSES OF THESE VARIANCES INCLUDE?
- PURCHASING NONSTANDARD OR UNECONOMICAL LOTS.
- PURCHASING FROM SUPPLIERS OTHER THAN THOSE OFFERING THE MOST FAVORABLE TERMS.
- FAILURE TO CORRECTLY FORECAST PRICE INCREASES.
THE PRODUCTION MANAGER OR FOREMAN IS HELD RESPONSIBLE FOR UNFAVORABLE LABOR EFFICIENCY VARIANCES. CAUSES OF THESE VARIANCES INLCLUDE?
- INADEQUATE SUPERVISION
- SUBSTANDARD OR INEFFICIENT EQUIPMENT
- POORLY TRAINED LABOR
SALES VOLUME VARIANCE
(ACTUAL UNITS SOLD-BUDGETED SALES UNITS)*STANDARD CM PER UNIT
SALES PRICE VARIANCE
(ACUAL SELLING PRINCE PER UNIT-BUDGETED PRICE PER UNIT)*ACTUAL UNITS SOLD
REVENUE VARIANCE
ALSO KNOWN AS SALES PRICE VARIANCE
(ACTUAL SP-BUDGETED SP)*ACTUAL UNITS SOLD
FLEXIBLE BUDGET VARIANCE DEALS WITH?
COSTS NOT REVENUES
IT IS THE DIFFERENCE BETWEEN THE ACTUAL AMOUNTS AND THE FLEXIBLE BUDGET AMOUNT FOR THE ACUTAL OUTPUT ACHIEVED.
A FAVORABLE MATERIAL PRICE VARIANCE COUPLED WITH AN UNFAVORABLE MATERIAL USAGE VARIANCE WOULD MOST LIKELY RESULT FROM?
THE PURCHASE OF LOWER THAN STANDARD QUALITY MATERIAL.
THE PURCHASE OF LOWER THAN STANDARD QUALITY MATERIAL WILL OFTEN RESULT IN AN UNFAVORABLE MATERIAL USAGE VARIANCE BECAUSE THE INFERIOR MATERIAL CAUSES MORE WASTE.
AND A FAVORABLE MATERIAL PRICE VARIANCE BECAUSE INFERIAL MATERIAL COST LESS.
MACHINE EFFICIENCY PROBLEMS WOULD NOT AFFECT
PRICE VARIANCE
PRODUCT MIX CHANGES WOULD AFFECT?
SALES VOLUME NOT MATERIAL PRICE OR PRODUCTION.
AN UNFAVORABLE DL EFFICIENCY VARIANCE COULD BE USED BY A??
UNFAVORABLE MATERIAL USAGE VARIANCE
AN UNFAVORABLE DL EFFICIENCY VARIANCE COULD BE CAUSED BY AN UNFAVORABLE MATERIAL USAGE VARIANCE. POOR QUALITY MATERIALS COULD EMAN UNFAVORABLE MATERIAL USAGE AND CAUSE INEFFICIENT LABOR USAGE.
FOR A COMPANY THAT PRODUCES MORE THAN ONE PRODUCT, SALES VOLUME VARIANCE CAN BE DIVIDED INTO WHICH OF THE FOLLOWING ADDITIONAL VARIANCES?
SALES QUANTITY VARIANCE AND SALES MIX VARIANCE
A STANDARD COSTING SYSTEM IS MOST OFTEN USED BY A FIRM IN CONJUCTION WITH?
FLEXIBLE BUDGETS. A STANDARD COSTING SYSTEM IS MOST OFTEN USED BY A FIRM IN CONJUCTION WITH FLEXIBLE BUDGETS.
WHICH IS NOT AN EXAMPLE OF RESPONISIBILITY ACCOUNTING?
PRODUCT CENTER DOES NOT REFER TO ANY RESPONSIBILITY O DECISION CENTER.
THE PURPOSE OF IDENTIFYING MANUFACTURING VARIANCES AND ASSIGNING THEIR RESPOSIBILITY TO A PERSON/DEPARTMENT SHOULD BE TO?
USE THE KNOWLEDGE ABOUT THE VARIANCES TO PROMOTE LEARNING AND CONTINUOUS IMPROVEMENT IN THE MANUFACTURING OPERATIONS.
THE BASIC DIFFERENCE BETWEEN A MASTER BUDGET AND A FLEXIBLE BUDGET IS?
A MASTER BUDGET IS BASED ON SPECIFIC LEVEL OF PRODUCTION AND A FLEXIBLE BUDGET CAN BE PREPARED FOR ANY PRODUCTION LEVEL WITHIN A RELEVANT RANGE.
UNDER THE BALANCED SCORECARD CONCEPT DEVELOPED BY KAPLAN AND NORTON, EMPLOYEE SATISFACTION AND RETENTION ARE MEASURES USED UNDER WHICH OF THE FOLLOWING PERSPECTIVES?
LEARNING AND GROWTH. EMPLOYEE SATISFACTION AND RETENTION MEASURES ARE USED UNDER THE LEARNING CURVE. PERSPECTIVE OF THE BALANCED SCORECARD.
CONTROLLABLE MARGIN
CM NET OF CONTROLLABLE FIXED COSTS (THOSE COSTS THAT MANAGERS CAN IMPACT IN LESS THAN ONE YEAR.
WHAT WOULD BE IMPACTED BY THE USE OF THE % OF SALES FORECASTING METHOND?
A/P
IF SALES INCREASED OR DECREASED, PURCHASES WOULD PRESUMABLE INCREASE OR DECREASE BY WHATEVER % WAS BEING USED IN THE BUDGETING PROCESS.
WHICH OF THE FOLLOWING BALANCED SCORECARD PERSPECTIVES EXAMINES A COMPANY SUCCESS IN TARGETED MARKET SEGMENTS?
CUSTOMER
THE CUSTOMER PERSPECTIVE OF A BALANCED SCORECARD IS CONCERNED WITH TARGET MARKETS. (LOW-PRICE LEADER)
FINANCIAL PERSPECTIVE OF BALANCED SCORECARD IS CONCERNED WITH?
THE CAPTURED OF INCREASED MARKET
THE INTERNAL BUSINESS PROCESS PERSPECTIVE OF BALANCED SCORECARD IS CONCERNED WITH?
MAINTAINING LOW COSTS THAT ARE SUPPORTED WITH LOW PRICES.
THE LEARNING GROWTH (ADVANCED LEARNING INNOVATION) PERSPECTIVE OF A BALANCED SCORECARD IS CONCERNED WITH?
LINKING STRATEGY WITH REWARD AND RECOGNITION.
LABOR USAGE/EFFICIENCY VARIANCE
IS THE DIFFERENCE BETWEEN STANDARD HOURS AT STANDARD WAGE RATES AND ACTUAL HOURS AT STANDARD WAGE RATE
WHICH OF THE FOLLOWING IS A CHARACTERISTIC OF A FLEXIBLE BUDGET?
PROVIDES BUDGETED NUMBES FOR VARIOUS ACTIVITY LEVELS.
A FLEXIBLE BUDGET ADJUSTS THE BUDGET AMOUNTS FOR DIFFERENT LEVELS OF ACTVITY. THE BUDGET IDENTIFIES VOLUME COMPONENTS OF VARIANCES FROM PLANNED ACITVITY.
THIS IS A PERFORMANCE MANAGEMENT MEASUREMENT THAT INTEGRATES BOTH FINANCIAL AND NON-FINANCIAL MEASURES OF PERFORMANCE?
BALANCE SCORECARD.
WHAT ARE THE 4 PERSPECTIVES OF A BALANCED SCORECARD?
- INNOVATION
- CUSTOMER SATISFACTION
- INTERNAL BUSINESS PROCESSES
- FINANCE
CUSTOMER SATISFACTION-BALANCED SCORECARD
MEASUREMENT OF CUSTOMER VALUE, SUCH AS DISCOUNTS PRICES COMPARED TO COMPETTORS FOA COST LEADER.
FINANCIAL-BALANCED SCORECARD
MEASURES OF FINANCIAL PERFORMANCE WOULD FOCUS MORE ON RESULTS OF OPERATIONS AND UTILIZATIONOF ASSETS
STATIC BUDGET CONTAINS WHICH OF THE FOLLOWING?
BUDGETED COSTS FOR BUDGETED OUTPUT.
A STATIC BUDGET IS BASED ON COSTS AT THE ONE LEVEL OF OUTPUT. STATIC BUDGES THUS INCLUDE COSTS FOR BUDGETED OUTPUTS. THEY ARE NOT BASED ON OR ADJUSTED FOR ACUTAL PERFORMANCE.
