The first step in preparing a flexible budget is to identify the fixed and variable cost components. prepare the budget for each activity level by multiplying each variable cost per unit by the activity level and then adding the fixed costs. identify the relevant activity levels. None of these choices are correct.

Answer

The first step in preparing a flexible budget is to identify the fixed and variable cost components. Prepare the budget for each activity level by multiplying each variable cost per unit by the activity level and then adding the fixed costs. Identify the relevant activity levels.

Q: What is the first step in preparing a flexible budget? A: The first step in preparing a flexible budget is to identify the fixed and variable cost components.
Q: How do you prepare the budget for each activity level? A: Prepare the budget for each activity level by multiplying each variable cost per unit by the activity level and then adding the fixed costs.
Q: What should be done to identify the relevant activity levels? A: Identify the relevant activity levels.