A flexible budget is "flexible" in the sense that a budget can be prepared for any level of activity, but once a budget is set the budget figures are not changed if actual activity later proves to be different than budgeted activity.

Flexible Budget

A budget that adjusts or flexes with changes in the volume or activity level, allowing for more accurate budgeting and analysis.

Standard Costing

A cost accounting system that uses pre-determined costs to value the cost of goods sold and assess the performance.

Labour Efficiency Variance

The difference between the actual labor hours used and the standard labor hours expected for the level of production achieved, often indicating productivity levels.