# Flexed budget

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Registered Posts: 7 Regular contributor ⭐
Can't seem to recall how to do the flexed budget question. Level 3 Practice Assessment 1 Question 2.4
Would reeeeeeeeeeeeally appreciate any help :crying:

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Which bit in particular are you stuck with? Have you managed to fill in any of the blanks so far?
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First thing you need to do is flex your original budget to show the budget for 144,000 sales. So go down the list, calculate the value for 1 item (so dividing by 100,000) and then calculate the value for 144,000 items.

Remember to flex all the variable costs but keep the fixed costs as they are in the original budget.

You then need to compare the figures on this new flexed budget with the actual costs and note down the variances in each line. Then just think to yourself, were the actual results better or worse than the budgeted ones, to decide whether each variance is Adverse or Favourable. Just remember that for some things, a lower cost is better (ie. labour costs) but sometimes a higher value is better (ie sales volume) so you need to look at what the figures represent in order to decide if they are adverse or favourable.
• Registered Posts: 7 Regular contributor ⭐
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Thank you so much! Seems so simple now :001_smile:
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My pleasure :001_smile:
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Hi NPS, I am struggling with this too, so what do I need to Divide by £100,000 to get one item. I am a little confused by the above information
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