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A budget "variance" is the difference between planned and actual performance.

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Q: What is budget variance?

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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

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Fixed overhead budgeted variance is the difference between estimated budgeted cost and actual fixed overhead cost of production.

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.

Budgeted variance analysis is very helpful in controlling the cost and expenditure of products and also helpful in determining the variation in the production expenditure with budgeted expenditure and help to eliminate variances in future and make better budgets.

Related questions

actual budget/budget = variance%

Variance = 100*(Actual - Budget)/Budget

how to calculate budget variance percentage?

A budget "variance" is the difference between planned and actual performance.

Fixed manufacturing overhead budget variance is?

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

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If the budgeted amount is 0 and the actual amount is $300, what is the variance percentage?

A variance is the difference between the projected budget and the actual performance for a particular account. A negative variance means that the budgeted amount was greater than the actual amount spent. A positive variance means that the budgeted amount was less than the actual amount spent. Note there is some debate over whether a negative variance means an underrun or an overrun. The Project Management Institute, however, endorses the accepted convention that a negative variance is a bad thing, and a positive variance a good thing.

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Monitoring income statements is a way that people can monitor variance between actual performance and budget. Managers can be assigned to look over income statements for clients.

Budget is the projected financial estimate in a given year, whilst expenditures are the actual expenses incured in carrying out the budget.