Explain the concept of variance analysis in budgeting and its importance in performance evaluation. Discuss the types of variances $($price$,$ quantity, and efficiency$)$ and how they are used to assess the effectiveness of cost management and operational efficiency.

Variance analysis involves comparing actual financial performance to budgeted performance to identify discrepancies and understand their causes. Describe the types of variances, including price variances $($differences in cost due to changes in prices$),$ quantity variances $($differences due to changes in the quantity of inputs used$),$ and efficiency variances $($differences due to variations in productivity or efficiency$).$ Explain the importance of variance analysis in evaluating performance, identifying areas for improvement, and making informed decisions about cost management and operational efficiency