Budgets and variances Flashcards
1
Q
What is a budget?
A
A detailed plan for the future concerning the revenues and costs expected over a certain period of time.
2
Q
What is a variance?
A
A variance arises when there is a difference between actual and budget figures.
3
Q
What are the two types of variances and what do they mean?
A
- Positive/favourable (better than expected)
- Adverse/unfavourable (worse than expected)
