Using budget variances to improve the business Going through this exercise can be an important management tool for analyzing what worked and what didn't work for a company in the given time period.

If you expected 100 items valued at $1 and find only 99, you have a $1 variance inaccuracy. Use the net dollar variance method. Count your inventory and value it at cost.

We'll calculate the historical monthly variance of the S&P 500 Total Return Index over a five-year period from August 2010 through July 2015 -- that's 60 observations (5 years x 12 months).

Replace "VAR" with "VARA" to view text as zeros. To calculate the variance of an entire population, rather than a sample of a population, use "VARP" to ignore text or "VARPA" to see text as zeros.

VAR.P, on the other hand, is for calculating variance in a population based on the entire set of numbers. If you don't have the entire population of data to use, you should use VAR.S in your formula.

Variance in Gross Margin by Changing Price and Cost For example, assume company ABC produces table lamps. Under the current business model, ABC produces 5,000 lamps per year at a cost of $25 per lamp.

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