Variances serve as an early warning system to alert managers to existing problems or prospective opportunities.

Question

Quizplus · Accepted Answer

Variances show differences between actual performance and expected performance, indicating areas where something is not going as planned. This allows managers to take action to address existing problems or capitalize on potential opportunities before they become larger issues. Therefore, variances do serve as an early warning system for managers.

Variances Serve as an Early Warning System to Alert Managers