Budget Variances

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  • Budget Variances
    • What is a budget?
      • A financial plan for the future concerning the revenues and costs of a business
    • What is budgeting?
      • An important role of the financial control of  business
      • Management prepare the individual budget e.g a sales or cost budget
        • They go through the year or time period, and look at how the actual results compare with the budgeted results.
          • The difference is variances- if these variances are significant they take a look to see why a difference has arisen
    • Variance Analysis
      • Involves calculating and investigating the differences between actual results and the budget

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