Profit Addition

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Definitions
Favourable Variance
Favourable Variance Standard Costing Budgetary Control Profit Addition Sales Revenue Budgeted Costs Cost Control Variance Analysis
In standard costing and budgetary control, a favourable variance is any difference between the actual and budgeted performance of an organization where this creates an addition to the budgeted profit. For example, a favourable variance may occur if the actual sales revenue is greater than that budgeted or if actual costs are less than budgeted costs.
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