What is 'variance' in SAP SRD-FIN-COR - FIN-Cost and Revenue?

variance - Overview

• Component: SRD-FIN-COR

• Component Name: FIN-Cost and Revenue

• Description: A difference between a planned or estimated amount and the actual amount. Variances can arise for example between a planned cost or revenue and the actual cost incurred or the actual revenue received.

variance - Details

• 
  Key Concepts: 
  Variance is a term used in SAP's SRD-FIN-COR FIN-Cost and Revenue Accounting component to describe the difference between the actual cost or revenue of a product or service and the expected cost or revenue. It is calculated by subtracting the expected cost or revenue from the actual cost or revenue. 
  
  How to use it: 
  Variance can be used to measure the performance of a product or service. It can also be used to identify areas where costs or revenues are higher than expected, which can help inform decisions about how to improve efficiency and profitability. 
  
  Tips & Tricks: 
  When calculating variance, it is important to consider factors such as inflation, exchange rates, and other external factors that may affect costs or revenues. Additionally, it is important to compare variance over time in order to identify trends and make more informed decisions. 
  
  Related Information: 
  Variance is closely related to other financial concepts such as budgeting, forecasting, and cost control. Understanding these concepts can help businesses better manage their finances and make more informed decisions.