Variance analysis may be performed to isolate the profit impact of individual input and output factors.

Question

Quizplus · Accepted Answer

Variance analysis is a useful tool for identifying the sources of cost and revenue deviations and their impact on profits. By analyzing the variances between actual and expected results, we can isolate the impact of individual input and output factors and identify opportunities for improvement in the business processes.

Variance Analysis May Be Performed to Isolate the Profit Impact