Budget variance calculator
Compare actual with budget and see whether the variance is favourable or unfavourable.
Enter your values and press Calculate. Your inputs stay in the address, so you can switch language or share the link.
Formula
variance = actual − budget variance % = variance ÷ budget × 100
How it works
Variance is actual minus budget. For an expense, spending above budget is unfavourable; for revenue, income above budget is favourable.
Worked example
The same calculation with the default values:
- Budget line type Expense
- Budgeted amount 10,000
- Actual amount 11,200
- variance = 11,200 − 10,000 = 1,200
- variance % = 1,200 ÷ 10,000 × 100 = 12%
Result: Variance (actual − budget): 1,200.00 USD · Variance %: 12% · Result: Unfavourable variance
A positive variance isn't automatically "good" and a negative one isn't automatically "bad" - spending less than budgeted on a revenue-generating activity can be a worse outcome than spending more, depending on what the line item is.
Common mistakes
- Assuming every negative variance (actual less than budget) is favorable without checking which direction is actually good for that specific line item - underspending on marketing, for instance, often means missed revenue, not savings.
- Comparing variance in absolute currency terms across line items of very different sizes instead of also looking at the percentage - a large line item can have a big dollar variance that's actually a small percentage, and vice versa.
- Treating a single period's variance as a trend - one month's deviation doesn't necessarily indicate an ongoing pattern.
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