Topic: Variance Analysis

Variance analysis is the process of comparing actual costs and results with the budgeted or standard costs allowed for a given level of output (goods produced or services delivered).

A = Budget Variance

B = Price or Rate Variance

C = Usage or Efficiency Variance

For each response, after the =, choose the best response (A, B, or C)

Defective materials have lower than expected yield =

Facility lease renewed at higher than planned rate =

Material purchases gets a supplier discount =

New workers take longer to complete work =

Production worker shortage causes high overtime =

Unplanned equipment retirement reduces depreciation =