Which type of variance causes operating income to be lower than the budgeted operating income?
A)Favorable variance
B)Neutral variance
C)Unfavorable variance
D)Reverse variance

Question

Quizplus · Accepted Answer

An unfavorable variance indicates that the actual performance is worse than the budgeted performance. Therefore, if operating income is lower than the budgeted operating income, it is considered an unfavorable variance.

Which Type of Variance Causes Operating Income to Be Lower