ECONOMICS (CBSE/UGC NET)

Detailed explanation-1: -A budget variance is an accounting term that describes instances where actual costs are either higher or lower than the standard or projected costs. An unfavorable, or negative, budget variance is indicative of a budget shortfall, which may occur because revenues miss or costs come in higher than anticipated.

Detailed explanation-2: -A budget variance is the difference between the budgeted or baseline amount of expense or revenue and the actual amount. The budget variance is favorable when the actual revenue is higher than the budget or when the actual expense is less than the budget.

Detailed explanation-3: -In short, your budget represents the numbers your startup expects to hit, while actuals are the numbers you’ve achieved in reality. When combined with your financial forecast, this is what each represents: Budget: What your startup expects to achieve. Actuals: What your startup actually achieved.

Detailed explanation-4: -A variance is the difference between actual and budgeted income and expenditure.