Static and Flexible Budgets

Having the highest quality product is extremely important within production. That is why production management looks at two budgeting techniques: static, and flexible budgets. In a static budget the expenditures do not change in response to sales levels, and is often used for public entities with fixed grants. With flexible budgeting, varying sales levels are put into the model, and the planned expense levels change accordingly. This can be advantageous when the company has trouble predicting sales.


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Last updated: 12/15/2017
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