Question

Why do we do variance analysis? What can we do with the variance analysis we perform?

Answer 1

A :- It is a tool applied to financial and operational data that aims to identify and determine that cause of the variance.variance analysis helps maintain control over a project's expenses by monitoring planned versus actual costs.

B :- variance analysis is the quantitative investigation of the difference between actual and planned behavior.this analysis used to maintain control over a business. For Example :- if you Budget for sales to be $20000 and Actual sales are $ 9000, variance analysis yields a difference of $11000.