# How to calculate budget vs actual variance in Excel

Subtract the budget from the actual: `=C2-B2`. Divide by the budget for the variance as a percentage.

**Excel:** `=C2-B2` (Every current version)

**Google Sheets:** the same formula works.

## Example

Sample data (row 1 is the header):

| A | B | C | D |
| --- | --- | --- | --- |
| Category | Budget | Actual | Variance |
| Salaries | 84000 | 86150 |  |
| Rent | 12000 | 12000 |  |
| Software | 6500 | 5920 |  |
| Travel | 4800 | 6210 |  |
| Marketing | 9000 | 7640 |  |
| Supplies | 1500 | 1385 |  |

Formula in D2, filled to D7: `=C2-B2`

Result: $2,150; $0; -$580; $1,410; -$1,360; -$115

## How it works

Actual minus budget gives a positive number when a cost came in over budget and a negative one when it came in under. Travel is $1,410 over and Marketing $1,360 under. The percentage version, (actual − budget) / budget, makes categories of different sizes comparable.

## Other ways

- `=B2-C2`: Budget minus actual, the convention some teams use for costs, so that under budget is positive. (The same amounts with the signs flipped.)

## Common mistakes

- Agree on the sign convention. For costs, over budget is bad; for revenue, over budget is good. Label the column so readers know which way is which.
- A zero budget makes the percentage #DIV/0!. Use `=IF(B2=0,"",(C2-B2)/B2)`.

## Questions

**How do I show the variance as a percentage?**

Divide by the budget and format as a percentage: `=(C2-B2)/B2` gives 29.4% for Travel and -15.1% for Marketing.

**How do I flag categories more than 10% over budget?**

Test the percentage: `=IF((C2-B2)/B2>10%,"Over","")`.

**How do I calculate the total variance?**

Use the totals: `=SUM(C2:C7)-SUM(B2:B7)`.

Every formula and result on this page was checked by running it in the Spreadsheet Practice formula engine on 2026-10-30.

Source: https://spreadsheetpractice.com/formulas/budget-vs-actual-variance