A non favourable variance
Eg: adverse revenue means the company earned less revenue than expected.
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Adverse variances means unfavourable variance which is actual expenses are more than budgted variance.
Incurring higher fixed costs than were planned for in the budget can cause adverse overhead capacity variance. Other caused can include planning errors, inefficient management of fixed overheads, and business expansion that was not added to the budget.
Favourable variance is that variance which is good for business while unfavourable variance is bad for business
There are 7 variances associated with a budget ( which are generally calculated for controlling purposes) 1- Material Price variance 2- Material Quantity variance 3- Labor rate variance 4- Labor efficiency variance 5- Spending variance 6- Efficiency variance 7- Capacity variance
Equal in Variance