What is the correct way of calculating the remaining amount after the variance

[mart_mrexcel]

What is the correct way of calculating the remaining amount after the variance in Actual vs. Budget and why

Data:
Actual is 11,000,000
Budget is 10,000,000

Calculation 1:
1-((Actual / Budget)-1) = 90%

Calculation 2:
Budget / Actual = 90.91%

 

[fjns]

Hi, both calculations are correct, but their meaning is different.

Transformation of the Calculation 1:
(1a) 1-(Actual / Budget)+1 = 90%
(1b) 2-(Actual / Budget) = 90%
(1c) 2-90% = Actual / Budget
(1d) 110% = Actual / Budget

The (1d) means that the Actual is 110 percent of the Budget.
(The (1d) can be considered as a separate calculation.)


The Calculation2 means that the Budget is 90.91 percent of the Actual.

 

[mart_mrexcel]

Hi, both calculations are correct, but their meaning is different.

Transformation of the Calculation 1:
(1a) 1-(Actual / Budget)+1 = 90%
(1b) 2-(Actual / Budget) = 90%
(1c) 2-90% = Actual / Budget
(1d) 110% = Actual / Budget

The (1d) means that the Actual is 110 percent of the Budget.
(The (1d) can be considered as a separate calculation.)


The Calculation2 means that the Budget is 90.91 percent of the Actual.

Thank you for the clarification