Cash variance analysis
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# Cash variance analysis

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 BabaJide Martins F. 0 0 Cash variance analysis is very vital in a business, it helps the business to know how cash is flow in and out of the busniesss and at the same time the strategies of CVA it helps to either to reduce or increase budget spending at a particular period. However, it might be favourable or unfavourable since it brings together three elements, SR, PM and CB and the difference will show on the report and of which it will help in financial reporting and it lets one knows the state of the business.
 Alice B. 0 0 The cash variance analyses is very important in a business as it indicates whether the budget is favourable or not, and it also helps the business to improve on its stratgies on either to reduce or increase the budget spending at a particular period.
 Richard B. 0 0 Variance analysis is usually associated with explaining the difference (or variance) between actual costs and the standard costs allowed for the better results.
 Morne V. 0 0 A variance report shows the difference between actual figures and budgeted figures for a period of time
 Morne V. 0 0 A variance report shows the difference between actual figures and budgeted figures for a period of time
 Sunday O. 0 0 Cash variance analysis
 Odongo M. 0 0 Accounting -> Cash variance analysis Cash variance analysis A variance report shows the difference between actual figures and budgeted figures for a period of time. Variance reports may be applied to any type of financial report. The cash variance report brings together the statement of receipts and payments and the cash budget. Budget Actual Variance Favourable (F)/Unfavourable (UF) \$ \$ Bank balance - 1 Jan. 4 000 4 000 + Cash receipts Cash sales 18 800 16 800 - 2000 UF UF Debtors 4 000 7 600 + 3 600 F F Capital 11 600 23 000 + 11 400 F F Total cash received 38 400 51 400 + 13 000 F F - Cash payments Advertising 800 300 + 500 F F Sales commission 500 200 + 300 F F Vehicles 10 000 12 000 - 2 000 UF UF Wages 8 000 10 000 - 2 000 UF UF Creditors 3 000 2 000 + 1 000 F F Drawings 5 000 4 000 + 1 000 F F Loan 5 000 6 500 - 1 500 UF UF Rent 1 000 1 100 - 100 UF UF Total cash payments 33 300 36 100 - 2 800 UF UF Bank balance - 31 Dec. 5 100 (15 300) 10 200 F F The preparation of the cash variance report requires the format set out. This is usually provided in the answer booklet in the examination. Many figures are also provided. Reconstruction of accounts may be necessary to determine amounts paid/received, opening or closing balances. You will also have to determine arithmetically the amount of the variance and whether it has been favourable or unfavourable. Marks are hard to get and showing all cash receipts entries correct in all columns may only earn a single mark. Many students lose marks by not showing totals for cash receipts, payments and the bank balance. From the above variance you may be asked: to comment on liquidity and to suggest strategies to help improve liquidity to explain the deterioration in liquidity to comment on whether the increased spending on vehicles is necessarily unfavourable to link the decline in sales to other expenses and suggest reasons why this occurs
 Saul K. 0 0 yes it is well stated
 Manish K. 0 0 informative ideas are found out.
 Davidson Ade O. 0 0 done
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