The basic difference between a master budget and a flexible budget is that a:

Multiple Choice

a) flexible budget considers only variable costs but a master budget considers all costs.

b) flexible budget allows management latitude in meeting goals whereas a master budget is based upon a fixed standard.

c) master budget is for an entire production facility but a flexible budget is applicable to single departments only.

d) master budget is based on one specific level of production and a flexible budget can be prepared for any production level within a relevant range.