alleryStart learning →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'_
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