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Forums › Ask ACCA Tutor Forums › Ask the Tutor ACCA PM Exams › VARIANCE FAVOURABLE OR ADVERSE
Good evening Sir,
I am currently on the lecture for variances however, what I am confused about is the fact that you stated that the variance should be an adverse instead of Favourable.
So the Actual purchase at STD COST is 517275 and
The ACUTAL PURCHASED AT STD COST 544500
Shouldn’t that be a favourable variance instead of adverse
512,275 is the actual purchases at actual cost (not at standard cost as you have typed).
Since the actual cost is lower than the standard cost the variance is favourable.