Differentiate between a static-budget variance and a flexible-budget variance.

A. A flexible-budget variance is the difference between the originally planned (static budget) amount and the actual amount. A static-budget variance is the difference between the actual amount and the amount that is expected for the actual level of output achieved.

B. A static budget variance is the difference between the originally planned (static budget) amount and the actual amount. A flexible-budget variance is the difference between the actual amount and the amount that is expected for the actual level of output achieved.

C. A static-budget variance arises when actual profits exceed budgeted profits. A flexible-budget variance arises when actual profits fall below budgeted profits.

D. A static-budget variance is the difference between the actual fixed-overhead cost and the budgeted fixed-overhead cost. A flexible-budget variance is the difference between the standard variable overhead rate and the actual variable overhead.