Variance analysis - case study
Specialty Foods Ltd
Tong Lui, the new management accountant, has just completed his first month's work. He has entered a huge amount of data into the finance and accounting system and is now faced with a pile of reports. One such report is shown below:
Specialty Foods Ltd. Profit Report: June (Units - $)
| Plan | Actual | Variance | |
|---|---|---|---|
| Profit | 10,000 | 9,000 | (1,000) |
| Sales | 110,000 | 120,000 | 10,000 |
| Costs | 100,000 | 111,000 | 11,000 |
Explain the meaning of the above report.
