A Petty Cash Fund, Established with a $250 Balance, Had

question 173

Multiple Choice

A petty cash fund, established with a $250 balance, had petty cash tickets totalling $219 and cash in the amount of $34. The entry to replenish the fund would include a:

• A)credit to Cash in Bank for $250.
• B)debit to Petty Cash for $219.
• C)debit to Cash Short and Over for $3.
• D)credit to Cash in Bank for $216.

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Definitions:

Fixed Overhead Volume Variance

The difference between the budgeted and actual volume of production, multiplied by the fixed overhead rate, indicating how fixed costs are allocated over different levels of output.

Fixed Overhead Budget Variance

This term refers to the difference between the budgeted fixed overhead costs and the actual fixed overhead costs incurred.

Standard Fixed Manufacturing Overhead Rate

The predetermined rate used to apply fixed manufacturing overhead to products, based on an estimate of total fixed manufacturing costs and an allocation basis.

Actual Fixed Overhead Costs

The real costs incurred for fixed overhead during a specified accounting period.