Mix Variances in Management Accounting: A Programming Analysis

Introduction Properly performed management accounting variance analyses frequently generate insight by management that helps to identify factors contributing to a poorer (or better) than expected performance, and to pinpoint persons or circumstances responsible for a variance. On the other hand, incorrect or inadequate evaluations are often dysfunctional to management. The wrong problem areas may be exposed by an incorrect evaluation, valuable time and expensive effort may be wasted in analysing the wrong problems, and improper actions might be enacted that would tend to hasten an already deteriorating situation.