What type of analysis would you use to identify the difference between planned and actual spending?

Variance analysis is utilized to identify the difference between planned and actual spending. This form of analysis specifically focuses on measuring the variances between budgeted figures and actual performance, allowing businesses to pinpoint areas where performance deviates from expectations. By analyzing these variances, management can understand the reasons behind over- or under-spending, which in turn aids in decision-making and strategic planning.

Cost-benefit analysis, trending analysis, and ratio analysis serve different purposes. Cost-benefit analysis evaluates the expected costs against the potential benefits of a decision or project. Trend analysis looks at patterns over time to forecast future performance based on historical data. Ratio analysis assesses financial health and performance by comparing figures across financial statements. Each of these analyses is useful in its own context, but they do not specifically address the comparison of planned versus actual spending as variance analysis does.