Question

Which of the following is not part of the flow of events in variance analysis: Multiple Choice

a.Working to ensure that all variances are favorable.
b.Preparing a standard cost performance report.
c.Taking corrective and strategic actions.
d.Computing and analyzing variances.
e.Identifying questions and their explanations.

Answer 1

Answer: a.Working to ensure that all variances are favorable.

Step-by-step explanation:

Variance Analysis is an analysis of the difference between planned and actual numbers. For example of $599 was budgeted for bills but only $500 was paid, $99 would be the Variance.

Summing Variances up gives a picture of performance for a particular period of time in relation to if one has OVER -PERFORMED or UNDER-PERFORMED

The following are steps in Effective Variance Analysis Management

1. Identifying questions and their explanations

2. Preparing standard cost performance reports

3. Taking corrective and strategic actions

4. Computing and analyzing variances.

Option A is not included therefore it is the correct option.

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