Week 5 Discussion Budgets 1 - ignoring the change. For...

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It is important for managers to look further into variances even if they are favorable because favorable variances are not always good. Often times, companies categorize favorable variances as positive and unfavorable variances as negative, however the bottom line is that a variance is still a discrepancy and should be considered and analyzed to avoid adverse consequences of
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Unformatted text preview: ignoring the change. For example, a favorable variance concerning advertising expenses can lead to an insufficient amount being spent on promoting a companys product or service. This could ultimately lead to losing customers to lack of marketing. Sources: http://acct202.tripod.com/Chapter%2010%20Outline.htm...
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This note was uploaded on 03/26/2012 for the course AC505 AC505 taught by Professor Dillan during the Spring '10 term at Keller Graduate School of Management.

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