In budgeting, what is the term for the gap between what was planned and what actually occurred?

Unlock all questions

This demo includes only 20 questions. Upgrade to access hundreds of questions, flashcards, exam simulations, and disable ads.

Full question bankExam simulationsFlashcards
From $24.99Unlock all

Prepare for the ManageFirst Hospitality Management Test with quizzes featuring multiple-choice questions, detailed explanations, and study tips. Ace your exam with confidence!

Multiple Choice

In budgeting, what is the term for the gap between what was planned and what actually occurred?

Explanation:
In budgeting, the gap between what was planned and what actually occurred is called variance. It measures how actual results differ from the budget, helping you see whether you overran costs or earned less (or more) than expected. For example, if you budget $50,000 for expenses and actual costs are $52,000, the variance is $2,000 unfavorable; if actual costs are $48,000, the variance is $2,000 favorable. The other terms don’t describe this difference between plan and reality.

In budgeting, the gap between what was planned and what actually occurred is called variance. It measures how actual results differ from the budget, helping you see whether you overran costs or earned less (or more) than expected. For example, if you budget $50,000 for expenses and actual costs are $52,000, the variance is $2,000 unfavorable; if actual costs are $48,000, the variance is $2,000 favorable. The other terms don’t describe this difference between plan and reality.

More Multiple Choice Questions
Subscribe

Get the latest from Examzify

You can unsubscribe at any time. Read our privacy policy