Your employer may choose to change your cafeteria plan to allow you to carry over up to $500 of unused amounts remaining at the end of the plan year in a health FSA to be paid or reimbursed for qualified medical expenses incurred during the following plan year. For example, if a household elects to order a cable or satellite television service, the cost recurs monthly. It is possible, however, to adjust the amount of resources that are devoted to food consumption for the weekly or monthly budget. A flexible budget would compare budgeted costs and actual costs, respectively, at 90,000 hours and 90,000 hours 17. Question 7 options: Wealth is not accumulated. In the United States, a flexible spending account (FSA), also known as a flexible spending arrangement, is one of a number of tax-advantaged financial accounts, resulting in payroll tax savings. B. Experian. A personal spending plan, similar to a budget, helps outline where income is earned and expenses are incurred. The consumer has the option of purchasing garments that are available at a discount, or buying similar items that are sold at full price. The flexible budget rearranges the master budget to reflect this new number, making all the appropriate adjustments to sales and expenses based on the unexpected change in volume. The accumulation of accounting data on the basis of the individual manager who has the authority to make day-to-day decisions about activities in an area is called responsibility accounting . Discretionary fixed expenses B. Flexible budget costs and static budget costs B. devotional anthologies, and several newspapers. Or, the truly budget-conscious can buy an inexpensive digital antenna and watch broadcast television for free. 51. To prepare a flexible budget, you need to have a master budget, really understand cost behavior, and know the actual volume of goods produced and sold. Example of Flexible Budgets. league baseball, and cycling. At each point in the process, the control is in the hands of the consumer, who can decide how and when to proceed with the transaction, controlling the amount of money spent in order to acquire a desirable or necessary item. Which one of the following uses your credit history to determine your credit score? An overview of the flexible spending account program for the Federal government, called FSAFEDS. A.) #40 which of the following statement is false? C. They work best to the extent that employees have unpredictable expenses. A budget that shows variable production costs only. Financially security is not being built Namuco, Inc. uses flexible budgeting for cost control. menu costs. Both flexible and static budgets can be … A budget is an estimation of revenue and expenses over a specified future period of time and is usually compiled and re-evaluated on a periodic basis. C. actual results and the expected results in the flexible … False. Revenues and expenses for changes in output (such as sales volume). B. There is no option of reducing or otherwise changing the amount of that month when and as desired, since the terms of the agreement governing the transaction do not allow for that type of activity. Even the cost of utilities such as electricity may be considered a flexible expense. Some debts involve a combination of fixed and flexible expenses. D. TransUnion. Actual costs and flexible budget costs C. Departmental costs and cost center costs D. Flexible budget costs and original budget costs A vacation or a new bicycle would be examples. New benefits are more difficult to introduce. It is important to pay the same amount each month in order to be considered current with the debt. Consumer discretionary is an economic sector comprising non-essential products that individuals may only purchase when they have excess cash. This example has the following details provided by a factory expected to operate at 70% level of activity (i.e., 14000 hrs)-Now, between 85% and 95% of activity level, its semi-variable expenses increase by 10%, and above 95% of activity level, they grow by 20%. If a Keynesian expenditure-output model shows that aggregate demand for both goods and labor has shifted to the left to D1, while wages remained at w0 and prices remained at P0, what will be the result? This is not the rule for determining whether an expense can be reimbursed by a flexible spending arrangement (FSA). variety of print and online publications, including wiseGEEK, and his work has also appeared in poetry collections, Understanding what does and does not constitute a fixed cost or expense … A company anticipates selling $200,000 of goods, of which $15,000 will probably be uncollectible. In personal budgeting, a flexible expense is one that can be cut back or eliminated. Commonly considered a flexible expense. This little known plugin reveals the answer. Its annual master budget reflects an indirect labor costs, a variable cost, of P360,000 based on an annual production of 200,000 units. The decision-making process starts with gathering information. Knowing where the money is going, and separating the flexible from the inflexible, can help people cope with a budget that is stretched to the limit or beyond. The debtor is expected to pay a minimum amount each month, with that amount determined by the lender, not the debtor. But it can be helpful to list all of one's flexible and inflexible expenses in order to really understand where all the money is going. Flexible expenses are costs that are not considered to be fixed or set, but can be reduced or increased on an as-needed basis. All of the following are limitations of short-term financial performance indicators except: D.Senior managers typically find non-financial performance indicators more useful than summary financial-performance indicators. A flexible expenses and a periodic expense are basically the same thing. A flexible budget variance for a manufacturing cost is computed as the difference between: A. Which of the following statements is true about flexible spending accounts? One significant disadvantage to using an FSA is that funds not used by the end of the plan year are forfeited to the employer, known as the "use it or lose it" rule. Malcolm’s other interests include collecting vinyl records, minor Wikibuy Review: A Free Tool That Saves You Time and Money, 15 Creative Ways to Save Money That Actually Work, Flexible Spending Account Medical Expenses. After many years in the teleconferencing industry, Michael decided to embrace his passion for Which of the following BEST describes a flexible budget? D. Funds must be used by the plan's year end or they revert to the employer. Health Flexible Spending Arrangements (FSAs) carryover amount. Should some unanticipated circumstance occur, the debtor can still keep the credit card account current by making the minimum payment due, while diverting the addition sum set aside to help manage the emergency. Which of the following is an example of a discretionary fixed expense? They restrict pretax employee contributions. The debtor can choose to set aside funds to pay a figure above and beyond that required minimum payment. The cost of living is the amount a person needs to spend to cover basic expenses such as housing, food, taxes, and healthcare in a particular place. Many corporation expenses as well as individual expenses are actually flexible in nature, in that there are ways to manipulate the amount of the expense and still remain within a balanced budget. All that is required to manage or control the cost of food is careful planning when it comes to grocery shopping, along with eliminating the number of times during the period that meals are eaten in a restaurant or ordered as takeout items. A flexible spending arrangement (FSA) is a form of cafeteria plan benefit, funded by salary reduction, that reimburses employees for expenses incurred for certain qualified benefits. Assuming that both garments are of similar quality, the consumer must make a decision regarding the purchase of one garment or the other, or even to forgo the purchase altogether. They can only be used for dependent-care expenses. Various articles of clothing are examples of flexible expenses. 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