basic objective of this article is to Define and Discuss on Flexible Budgets. Here discuss Flexible Budgets in accounting terms with examples. A budget report is ready to show how actual results compare towards the budgeted numbers. It has columns for the actual and budgeted amounts and the differences or variances, among these amounts. A variance could be favorable or unfavorable. By using an income statement budget record, think of how the variance affects net income, and you will know if it’s a favorable or unfavorable variance.