Chris Promises Doreen $40,000 If She Graduates from Eagle College

question 31

Essay

Chris promises Doreen $40,000 if she graduates from Eagle College.Doreen enrolls in Eagle,attends full-time for four years,and graduates.When Doreen asks Chris for $40,000,Chris says,"I don't remember promising you $40,000.But if there was a promise,it's not enforceable,because we didn't bargain for it.And even if there was a promise that would otherwise be enforceable,I revoke it now." Can Doreen enforce Chris's "promise" Why or why not

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Definitions:

Direct Materials Price Variance

The difference between the actual cost of direct materials purchased and the expected (standard) cost multiplied by the actual quantity purchased.

Standard Costs

Standard costs are the estimated costs associated with the production of goods or services, used as target costs to aid in budgeting and performance evaluation.

Actual Costs

The real costs that a company incurs for producing or acquiring goods or services.

Direct Materials Price Variance

The difference between the actual cost of direct materials used in production and the standard cost of materials that were expected to be used.