Question

agree or disagreed why?

Apple can use variances in analyzing its operating performance for improving their operational performance by analyzing those variances set by management to increase their sales. They can use profit variances to improve their operational performance by analyzing those profit targets set by management to increase their profit. They can use Cost variances for improving their operational performance by analyzing those Cost targets set by management to reduce their cost targets. These stores can use the Labor and overhead variances to access the performance of their labor and overhead expenses also along with the above Sales variances.

Answer 1

Agreed.

Variances analyses is basically the analysis of deviations actual result and desired result of a business activity with the objective to identify the reasons of such deviations. It could be under performance or unrealistic desired result.

Examining variances helps management to control cost and improve operational efficiency.

Sales variances measures the performance of sales function. Reason for unfavourable sales variances either lower selling price or less quantity sold.

Cost variances measures the performance of procurement and production function. Reason for unfavourable cost variance could be increased in purchase price, delivery cost, emergency buying, increased in labour cost, labour strikes etc.

Profit variances measures the performance of an organization. Reason for unfavourable variances could be lower sales or increased cost.

Operational performance can be improved by analyzing all the variances simultenously whether it is cost, sales, overhead, material or labour. First to identify the unfavourable variance then identify the reasons for the same and digging down further to find out cause and measures to improve the same.