Budgeting and Variance Analysis

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budget

Back

a financial plan for a business or organisation that is prepared in advance

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Standard Cost

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a pre-determined cost of a unit of output

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Flexed budget

Back

Budget which changes with the level of activity

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Fixed budget

Back

Budget which remains the same whatever the level of activity

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Rolling budget

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a budget that is continuously updated so that the next 12 months of operations are always budgeted

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favourable variance (costs)

Back

where actual costs are lower than budgeted costs

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adverse variance (income)

Back

where actual revenues are lower than budgeted revenues

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favourable variance (Income)

Back

where actual revenues are higher than budgeted revenues

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adverse variance (costs)

Back

where actual costs are higher than budgeted costs