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Now simply put variance analysis is used to control businesses and involves a quantity-based approach. Here, a differentiation can be noticed in the real and planned actions of a company. These departures are studied and reasons behind them analyzed. Budget planning, allocation of resources and profit considerations take this concept into account.

**Types of variance **

Businesses are of various types and under different market conditions the modes of variance may also differ. To completely comprehend such an idea the popular types of variances need to be noted down:

**Purchase price variance**

Such calculations involve the real purchased rates of raw materials minus standard costs, results of which are multiplied to units used.

**Selling price variance**

Similarly the sum of real cost of selling a finished item minus the standard selling price needs to be multiplied by number of units sold to get this value.

**Labor efficiency and rate**

Two concepts are dealt with here; labor efficiency is obtained by subtracting standard labor quantity consumed from actual amount and then multiplying the value with standard rates per hour.

**Variance Analysis Assignment Answers** also explains labor rates where the value of actual labor rates paid after removing standard costs are multiplied with total units used.

**Variable overhead spending and efficiency**

Variable overhead efficiency multiples the standard overhead costs per unit with the sum obtained after removing those budgeted units of activity from actual units of activity.

In variable overhead spending total quantity of output is multiplied with the sum obtained after removing variable overhead costs from real rates incurred.

**Material yield**

According to the experts at **Variance Analysis Assignment Answers**, subtracting the complete value of standard quality material from the actual usage and then multiplying the value with the remaining standard price per unit will reveal this variance.

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