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Budget Variance Calculator

Formula

To calculate the Budget Variance (BV% and AB):

$BV\% = \left( \frac{A - F}{A} \right) \times 100$

$AB = A - F$

Where:

$BV\%$ is the Budget Percentage Variance
$AB$ is the Absolute Variance
$A$ is the Actual Budget Cost or Actual Outcome
$F$ is the Forecasted Budget

What is Budget Variance?

A budget variance is defined as either the percentage or absolute difference between a forecasted budget and the actual cost or budget that occurred. Most often it makes sense to look at this in terms of a percentage. Then companies can analyze and compare the variance to other budgets.

Example Calculation

Let's assume the following values:

Actual Budget ( $A$ ) = 12000 currency units
Forecasted Budget ( $F$ ) = 10000 currency units

Using the formula:

$BV\% = \left( \frac{12000 - 10000}{12000} \right) \times 100 = \left( \frac{2000}{12000} \right) \times 100 = 16.67\%$

$AB = 12000 - 10000 = 2000 \text{ currency units}$

The Budget Percentage Variance is 16.67% and the Absolute Variance is 2000 currency units.