What is the purpose of the flexible budget? to justify budget requests each year as if prior budget information did not exist to encourage managers to spend all their budgeted money each year to avoid future cutbacks to address the difference between budgeted cash receipts and budgeted cash disbursements to understand how budgeted costs and revenues change across different levels of sales volume The general model for calculating a price variance is SP times (SQ AQ) AQ times (SP AP) AP times (SP AP) SQ times (SP AP)