Yes, because the management can figure out the most cost efficient way to produce a product or get a supply for the materials. For example, if supplies expense was budgeted to be RM30,000 but the management figured out that there are cheaper ways to get the supplies so the actual supplies expense ends up being RM28,000, the RM2,000 variance is favorable because having fewer expenses than were budgeted was good for the company's profits.

is this correct?