Budgets(HL) Definitions Flashcards
1
Q
Budget
A
a plan that outlines a business’ revenue and expenditure over a period of time
2
Q
Profit centre
A
a department in a business that generates both revenue and costs
3
Q
Cost centre
A
a department in a business that generates cost but no revenue
4
Q
Variance(in cost or managerial accounting)
A
the difference between planned or budgeted sales revenue and costs and the actual sales revenue and costs.
5
Q
Variance analysis
A
a tool used to compare a business’ budgeted sales revenue and costs with the actual figures over a period of time
6
Q
Favourable variance
A
a situation whereby actual income and expenditure figures are better for the business than expected
7
Q
Adverse variance
A
a situation where actual income and expenditure figures are worse for the business than expected
