VARIANCE ANALYSIS Definition

Bookmark and Share

VARIANCE ANALYSIS is the analysis of performance by means of variances. Used to promote management action at the earliest possible stages. After a budget (based on standard costs) has been set, its usefulness lies in the review procedures which compare actual results against the budget. Variance analysis is the process of examining in detail each variance between actual and budgeted/expected/standard costs to determine the reasons why budgeted results were not met (material costs too high, sales prices too low, etc.).

Learn new Accounting Terms

INVENTORY TURNOVER is a ratio that shows how many times the inventory of a firm is sold and replaced over a specific period.

MARK is a currency of Bosnia & Herzegovina, Germany, Saar, and Memel.

Suggest a Term

Enter Search Term

Enter a term, then click the entry you would like to view.