Budgetary Control
Monitoring actual performance against budgets; taking corrective actions.
Formula
Variance = Actual − Budget (positive = favourable for revenue; adverse for costs)
Real World
Tesco's finance teams compare weekly actual sales and costs against budgeted figures store-by-store, triggering management intervention when an adverse variance exceeds 5%.
Exam Focus
Always state whether a variance is favourable or adverse AND explain a possible cause — one-word answers score zero on 'explain' questions.
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