Presented Below Are Some Business Transactions That Occurred During 2013

question 24

Essay

Presented below are some business transactions that occurred during 2013 for Cahill Company: Instructions
For each situation above, identify the assumption, concept, or constraint that has been violated, if any. If the entry is incorrect, prepare the entry that should have been made, if any.

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Definitions:

Standard Cost

A predetermined cost of manufacturing a single unit or a number of product units during a specific period under normal conditions.

Variable Overhead

Costs that vary with production volume, such as utilities or materials, which do not remain fixed over time.

Cost Driver

A factor that causes the cost of an activity to increase or decrease, such as machine-hours, labor hours, or production volume.

Budget Variance

The difference between the budgeted or planned amount of expense or revenue, and the actual amount incurred or earned.