The Lucky Inn budgeted revenue of $12,000 during a period when $10,000 was actually generated. What was the percentage variance for the period?

Question

Quizplus · Accepted Answer

To find the percentage variance, we need to calculate the difference between budgeted revenue and actual revenue, divide it by budgeted revenue, and multiply the result by 100. 
Percentage variance = ((budgeted revenue - actual revenue) / budgeted revenue) x 100
= (($12,000 - $10,000) / $12,000) x 100
= (0.167) x 100 = 16.7% unfavourable
Since the actual revenue is less than the budgeted revenue, the variance is unfavourable. Therefore, the correct answer is option B.

The Lucky Inn Budgeted Revenue of $12,000 During a Period