When an Organization's Actual Revenues Are Greater Than Its Budgeted

question 122

True/False

When an organization's actual revenues are greater than its budgeted revenues, the difference is referred to as a favorable variance.

Identify the impact of changes in liabilities, assets, and owner's equity on the overall financial position of a business.

Learn about the key assumptions underlying financial accounting, including the monetary unit assumption.

Understand how revenues, expenses, and withdrawals affect owner's equity.

Comprehend the impact of transactions involving cash and credit on business accounts.

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Definitions:

Liquidated Damages

Pre-determined damages specified in a contract that the parties agree on as compensation if one party breaches the contract.

Option To Terminate

A provision in a contract that allows one or more parties to end the agreement under certain conditions, before the completion date.

Force Majeure

A major, unforeseen, or unanticipated event that occurs and prevents the performance of a contract.

Frustrated Contracts Act

Legislation that deals with contracts that, through no fault of either party, cannot be fulfilled due to unforeseen events.