Home › US CMA Part 1 › Accounting › Standard Costs and Variances › A variance is defined as a difference between th…
A variance is defined as a difference between the standard and the:
AActual performance
BBudgeted revenue
CForecast headcount
DHistorical average
Answer & Solution
Correct answer: A. Actual performance
1. A variance compares two figures.
2. A standard sets out what performance is expected.
3. When performance does not match expectations, a variance arises.
4. It is a difference between the standard and the actual performance.
_Source: OpenStax Principles of Accounting, Volume 2: Managerial Accounting (CC BY-NC-SA 4.0), Ch 8 'Standard Costs and Variances'_
Related questions
Spending exactly the standard amount on materials produces a variance of:A standard cost is described as being developed in order to:Paying workers less per hour than the standard rate produces which variance?Using 10 kilograms of material where the standard allowed 8 produces which variance?Buying cheaper but poorer material that workers waste illustrates that variances can be:Alongside labor efficiency, a favorable material price variance could also cause an unfavoA favorable material price variance is described as possibly causing an unfavorable:An instructor's syllabus is described as one way to communicate expectations to: