On November 1,Orpheum Company Accepted a $10,000,90-Day,8% Note from a Customer

question 63

Multiple Choice

On November 1,Orpheum Company accepted a $10,000,90-day,8% note from a customer settle an account.What entry should be made on the November 1 to record the note acceptance?

• A)Debit Note Receivable $10,000;credit Cash $10,000.
• B)Debit Note Receivable $10,000;credit Accounts Receivable $10,000.
• C)Debit Note Receivable $10,000;credit Sales $10,000.
• D)Debit Cash $10,000;credit Sales $10,000.
• E)Debit Sales $10,000;credit Accounts Receivable $10,000.

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Definitions:

Raw Materials Used

The total quantity of raw components consumed in the production process to manufacture goods.

Raw Materials Inventory

The total cost of all the components lying in a manufacturing or production facility that have not yet been used or processed.

Underapplied Overhead

Occurs when the allocated manufacturing overhead cost is less than the actual overhead incurred, leading to under-recovered expenses.

Manufacturing Overhead

This includes all the indirect costs associated with manufacturing a product, such as utilities, indirect labor, and maintenance of equipment.