Standard costing: 
Based on standard (budgeted) values rather than on actual results.
Static budget:
Used for standard costing. Created in an income statement format that summarizes the expected performance at the beginning of the budgeting period. The volume that is used is the expected production (or sales) volume.
Flexible budget:
The flexible budget is the budget that is created at the end of the year that represents the actual volume produced (or sold) during the specified period.
Flexible Budget Variance:
Difference between the static budget and the flexible budget. To determine what the reasons are for the variance, the following variances are calculated by changing one variable at a time:
Volume Variance:
This variance estimates the impact on profits of changes in sales volume
Volume Variance = (Actual volume – Budgeted volume) x Budgeted contribution margin
Efficiency Variance:
This variance estimates the impact of changes in efficiency use of inputs
Efficiency variance = (Budgeted quantity – Actual quantity) x Budgeted price of inputs
Sales Price Variance:
This variance estimates the impact on profits of changes in mix of sales
Sales price variance = (Actual price – Budgeted price) x Actual volume
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