A budget variance is the difference between the budgeted or baseline amount of expense or revenue, and the actual amount. The budget variance is favorable when the actual revenue is higher than the budget or when the actual expense is less than the budget.
Likewise, people ask, what is the difference between a standard and a budget?
What is the difference between a budget and a standard? A budget usually refers to a department's or a company's projected revenues, costs, or expenses. A standard usually refers to a projected amount per unit of product, per unit of input (such as direct materials, factory overhead), or per unit of output.
What is a budget to actual report?
Budget-To-Actual Report. This report shows the difference between your budgeted purchases and actual asset purchases. It also separately lists categories to which you have added assets during the period, but for which you have not allocated a budget amount.
What is the meaning of actual budget?
A favorable budget variance indicates that an actual result is better for the company (or other organization) than the amount that was budgeted. Here are three examples of favorable budget variances: Actual revenues are more than the budgeted or planned revenues. Actual expenses are less than the budget or plan.