The flex in the flexible budget relates solely to variable costs. Do you agree? Explain.

We want a flexible budget because costs are difficult to predict. We need the flexibility to change budgeted costs as input prices change. Does a flexible budget serve this purpose? Explain.

Managers should be rewarded for favorable variances and punished for unfavorable variances. Do you agree? Explain.

Price variances should be computed even if prices are regarded as being outside of company control. Do you agree? Explain.

Failure to meet price standards is the responsibility of the purchasing officer. Do you agree? Explain.