Flexible budget for Amazon based

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Create a flexible budget for Amazon based on the 2012 actual result, being realistic based on history and economic trends. Use the absorption costing approach.

Show three different growth rates. Explain your estimates and assumptions. Specifically, explain:

What is the growth rate in sales for the past three years?

Are revenues and expenses growing at the same rate? What was the experience in the past few years?

What is the current growth rate in the economy?

How are the competitors doing?

Current interest rates and tax burdens.

Discuss the implications of the flexible budget.

How does the flexible budget differ from a static budget?

Budgets are used for planning and control. Discuss how you can use the information derived for these two purposes?

Comment on using this information for performance evaluations.

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