Chapter 22, Problem 5E

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PrimeTech Solutions maintains a petty cash fund with a current balance of $1,200. Recent receipts include $275 for office supplies, $195 for courier services, and $210 for refreshments. After these expenses, the remaining cash count in the fund is $480. Calculate the variance in the petty cash fund based on these records.

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What amount should be considered product costs for external reporting purposes if the company uses absorption costing?