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    Question

    The classification of fixed and variable cost has a specific significance in the preparation of

    A zero-based budget Correct Answer Incorrect Answer
    B flexible budget Correct Answer Incorrect Answer
    C capital budget Correct Answer Incorrect Answer
    D cash budget Correct Answer Incorrect Answer
    E functional budget Correct Answer Incorrect Answer

    Solution

    A flexible budget is prepared by separating costs into fixed and variable components. This allows the budget to adjust to different levels of activity, making it a valuable tool for performance evaluation and decision-making.

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