Correct Answer: 1 A fixed budget is established for a specific level of activity whereas flexible budget is prepared for various levels of activity 2 Fixed budget cannot be changed after the period commences, whereas a flexible budget can be changed after the period commence 3 Fixed budget is more suitable for fixed expenses whereas flexible budget takes both fixed as well as variable expenses in account 4 Fixed budget includes only fixed costs, whereas a flexible budget includes fixed costs, variable costs and semi variable costs 5 Fixed budget is mainly used in planning stage whereas flexible budget is used in controlling stage
