Actual costs are determined by plugging the actual level of activity for the period into the cost formulas used in flexible budgets.

Actual Costs

The true or realized expenses incurred in the production of goods or services, as opposed to estimated or budgeted costs.

Actual Level

The real, measured level of activity achieved during a specific period, often contrasted with planned or estimated levels.

Cost Formulas

Equations used to calculate costs, often incorporating fixed and variable components.