• Skip to primary navigation
  • Skip to main content
  • Skip to primary sidebar
Free ACCA & CIMA online courses from OpenTuition

Free ACCA & CIMA online courses from OpenTuition

Free Notes, Lectures, Tests and Forums for ACCA and CIMA exams

  • ACCA
  • CIMA
  • FIA
  • OBU
  • Books
  • Forums
  • Ask AI
  • Search
  • Register
  • Login
  • ACCA Forums
  • Ask ACCA Tutor
  • CIMA Forums
  • Ask CIMA Tutor
  • FIA
  • OBU
  • Buy/Sell Books
  • All Forums
  • Latest Topics

20% off ACCA & CIMA Books

OpenTuition recommends the new interactive BPP books for September 2025 exams.
Get your discount code >>

Budgeting (Please Reply ASAP)

Forums › Ask ACCA Tutor Forums › Ask the Tutor ACCA MA – FIA FMA › Budgeting (Please Reply ASAP)

  • This topic has 4 replies, 2 voices, and was last updated 3 years ago by John Moffat.
Viewing 5 posts - 1 through 5 (of 5 total)
  • Author
    Posts
  • January 31, 2022 at 4:35 am #647770
    Isabella1
    Participant
    • Topics: 44
    • Replies: 23
    • ☆☆

    If there is calculation of variance between Fixed budget and Actual so it can has volume and price variances.
    If variance is calculated between Flexed budget and Actual so there is only price or expenditure variance. (No Quantity or Activity variances).

    January 31, 2022 at 5:07 am #647772
    Isabella1
    Participant
    • Topics: 44
    • Replies: 23
    • ☆☆

    Question two
    In Sales Variance, we compare Actual and Fixed Budget.
    In Cost Variances, we compare Actual and Flexed Budget.
    Are these correct?

    Question three:
    Flexed budget and Flexible is made under marginal costing? This is why fixed cost is same as budgeted?

    January 31, 2022 at 7:49 am #647782
    John Moffat
    Keymaster
    • Topics: 57
    • Replies: 54700
    • ☆☆☆☆☆

    Please don’t ask for replies ‘ASAP’. We do not sit in front of the computer all day (I do have work to do) but I always answer within 24 hours.

    Q1 If using marginal costing then the only variance is the expenditure variance which is the difference between the actual fixed overheads and the originally budgeted fixed overheads.

    If using absorption costing then the total fixed overhead is the difference between the actual fixed overheads and the flexed budget fixed overheads (and the total can be analysed into the volume variance and the expenditure variance).

    January 31, 2022 at 7:51 am #647783
    John Moffat
    Keymaster
    • Topics: 57
    • Replies: 54700
    • ☆☆☆☆☆

    Q2 For the sales volume variance we compare the actual sales with the budget sales and cost out at the standard profit or contribution (depending on whether we are using absorption costing or marginal costing). For the sales price variance we compare the actual sales at actual selling price with the actual sales at the standard selling price.

    January 31, 2022 at 7:53 am #647784
    John Moffat
    Keymaster
    • Topics: 57
    • Replies: 54700
    • ☆☆☆☆☆

    Q3 If a question requires the preparation of the flexed budget then fixed overheads stay fixed whether we are using absorption or marginal costing.

    Variance analysis when using absorption costing effectively assumes that fixed overheads are flexed (however you will not be required to produce a flexed budget if calculating variances – I do flex it in my lecture simply to explain why the absorption costing variances are as they are, i.e. why there is a volume variance.

  • Author
    Posts
Viewing 5 posts - 1 through 5 (of 5 total)
  • You must be logged in to reply to this topic.
Log In

Primary Sidebar

Donate
If you have benefited from our materials, please donate

ACCA News:

ACCA My Exam Performance for non-variant

Applied Skills exams is available NOW

ACCA Options:  “Read the Mind of the Marker” articles

Subscribe to ACCA’s Student Accountant Direct

ACCA CBE 2025 Exams

How was your exam, and what was the exam result?

BT CBE exam was.. | MA CBE exam was..
FA CBE exam was.. | LW CBE exam was..

Donate

If you have benefited from OpenTuition please donate.

PQ Magazine

Latest Comments

  • osman-the-zephyr@ on MA Chapter 1 Questions Accounting for Management
  • adebusola on MA Chapter 1 Questions Accounting for Management
  • Sharith on Interest rate risk management (1) Part 5 – ACCA (AFM) lectures
  • Sharith on Interest rate risk management (1) Part 5 – ACCA (AFM) lectures
  • John Moffat on Discounted Cash Flow Further Aspects, Replacement – ACCA Financial Management (FM)

Copyright © 2025 · Support · Contact · Advertising · OpenLicense · About · Sitemap · Comments · Log in