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A budget is an approximate calculation of the expenditures for a particular activity or project over a period of time. If at the end of the day budget exceeds then it is considered as profit. If a budget is balanced, then it is said that the estimation and real calculation are equal and if there is a budget deficit found then that means the expenses have exceeded.
The variance is the estimation of the differences between the estimated calculation and the actual estimation. This variation is useful in estimation of the total expenditures of a company.
The budget variance is the variation of the estimated amount and the actual amount. The budget is most useful when the real expenses are more or less than the estimated budget. Some of the minor budget variances can be avoided by simple aggregate calculations.
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