Question

Kathy reviews her division's quarterly results and sees that some units exceeded goals while others did not. Next, she will attempt to determine why performance of the different units varied, and whether the variation: A. created a net benefit or loss. B. should be reported to senior executives or not. C. was consistent with the company's mission statement. D. offers opportunities for diversification. E. was due to factors within or outside the firm's control.

Answer 1

E. Was due to factors ...

Answer 2

E. was due to factors within or outside the firm's control.

Step-by-step explanation:

The purpose of variance analysis is to address the differences between the budgeted and actual performance of the company.

Variance analysis aids in understanding the reasons fluctuations happen with the aim of reducing or avoiding adverse variances, which eventually leads to improved budgeting.

The reason an organisation would want to know if variances were due to factors within or outside the organisation is because they need to address all such variances that are under management control by looking at what could have been differently.