Why is the identification of favorable variances

Assignment Help Managerial Accounting

Reference no: EM132459203

Question: Why is the identification of favorable and unfavorable variances so important to a company? How can the identification of the variances help management control costs? Please explain.

As you are considering the flexible budgeting topic of the week, it is important for you to look at this analysis as a significant contribution to the management of the company. Knowing what the bottom line profit or loss is important. But what is more important is to understand how your actual results varied in terms of units sold versus how the actual cost of each unit differed from the budget.

Please do watch the video available in this week's resources - you can turn the sound off and read the script on the right side if you need to. The lecturer has an excellent example that will help you.

Do you have an example that you can share?

Reference no: EM132459203

Questions Cloud

Teach the concept of ey taking care : Teach the concept of EY taking care to explain why EY decreases as the time to payoff of debt decreases. Teach me the concept(s).

Compute the amount to which the deposits will grow : Compute the amount to which the deposits will grow if,Deposits of $10 million are made at the end of each year with interest compounded annually

Make a recommendation based on your findings : Axis Corp. is considering an investment in the best of two mutually exclusive projects. Project Kelvin involves an overhaul of the existing? system

Prepare gs statement of cash flows : Prepare G's statement of cash flows using the indirect method for the year ended 12-31-19.Label each section amount as cash provided by OR cash

Why is the identification of favorable variances : Why is the identification of favorable and unfavorable variances so important to a company? How can the identification of the variances help management control

Calculate net present value of the helicopter purchase : Calculate net present value of the helicopter purchase and state whether or not the firm should buy it.

Set up an analytical income statement : Set up an analytical income statement to verify your solution to part ?(a?).

What is the? break-even point in pairs of shoes : What is the? break-even point in pairs of shoes sold for the? company?

Projected roes under the restricted and relaxed policies : In this situation, what's the difference between the projected ROEs under the restricted and relaxed policies?

User Account

All Pages