| Budgetary control | Management use of budgets to monitor and control company operations.
|
 |
|
|
| Budget report | Report comparing actual results to planned objectives; sometimes used as a progress report.
|
|
|
|
| Cost variance | Difference between the actual incurred cost and the standard cost.
|
|
|
|
| Efficiency variance | Difference between the actual quantity of an input and the standard quantity of that input.
|
|
|
|
| Favorable variance | Difference in actual revenues or expenses from the budgeted amount that contributes to a higher income.
|
|
|
|
| Fixed budget | Planning budget based on a single predicted amount of volume; unsuitable for evaluations if the actual volume differs from predicted volume.
|
|
|
|
| Fixed budget performance report | Report that compares actual revenues and costs with fixed budgeted amounts and identifies the differences as favorable or unfavorable variances.
|
|
|
|
| Flexible budget | Budget prepared (using actual volume) once a period is complete that helps managers evaluate past performance; uses fixed and variable costs in determining total costs.
|
|
|
|
| Flexible budget performance report | Report that compares actual revenues and costs with their variable budgeted amounts based on actual sales volume (or other level of activity) and identifies the differences as variances.
|
|
|
|
| Overhead cost variance | Difference between the total overhead cost applied to products and the total overhead cost actually incurred.
|
|
|
|
| Price variance | Difference between actual and budgeted revenue or cost caused by the difference between the actual price per unit and the budgeted price per unit.
|
|
|
|
| Quantity variance | Difference between actual and budgeted revenue or cost caused by the difference between the actual number of units and the budgeted number of units.
|
|
|
|
| Standard costs | Costs that should be incurred under normal conditions to produce a product or component or to perform a service.
|
|
|
|
| Unfavorable variance | Difference in revenues or costs, when the actual amount is compared to the budgeted amount, that contributes to a lower income.
|
|
|
|
| Variance analysis | Process of examining differences between actual and budgeted revenues or costs and describing them in terms of price and quantity differences.
|