From a budgeting view,which of the following statements is not true concerning variances?
A)A favorable expense variance means the budgeted amount was more than actual.
B)Cumulative variance = current month's variance + variances of previous months.
C)Ideally,cumulative variances for the year will equal zero.
D)Ideally,cumulative variances for the year should have a positive value.

Question

Quizplus · Accepted Answer

Ideally, cumulative variances for the year should be zero, not have a positive value. Having a positive cumulative variance means that actual expenses have exceeded the budgeted amount, which is not desirable from a budgeting perspective.

From a Budgeting View,which of the Following Statements Is Not