Identify the situation that will result in a favorable variance.
A) Actual revenue is higher than budgeted revenue.
B) Actual revenue is lower than budgeted revenue.
C) Actual income is lower than expected.
D) Actual costs are higher than budgeted costs.
E) Actual expenses are higher than budgeted expenses.

Question

Quizplus · Accepted Answer

A favorable variance occurs when actual results exceed budgeted expectations. In this case, if actual revenue is higher than budgeted revenue, this would be a favorable variance.

Identify the Situation That Will Result in a Favorable Variance