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    Advanced Cost Accounting: Favorable Variances

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    Why should favorable variances be analyzed? What should a business organizations process for investigating variances communicate to the employees?

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    https://brainmass.com/business/accounting/advanced-cost-accounting-favorable-variances-120423

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    As a financial analyst, I make a living out of explaining variances. Favorable variances must be analyzed for the same reason unfavorable variances must be. Several issues arise from favorable variances. One is that there may have been, and may continue to be a problem with budgeting. If upper management is deficient in one area, they may be compensating for that by budgeting an inflated ...

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    This solution explains why favorable variances should be analyzed and the process behind this.

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