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Would changes in the production process would cause a planning variance or an operational variance?
Changes in the production process can cause both planning variances and operational variances.
Planning variances occur when there are changes in production schedules that we were not aware of due to bad forecasting or changes in the market.
Operational variances occur when there are changes in labour efficiency, or production volumes down to our decisions.
Therefore, changes in the production process can lead to both planning variances and operational variances.
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