Altima,Inc

question 176

Multiple Choice

Altima,Inc.finished Job A40 on the last working day of the year.It utilized $370 of direct materials and $3420 of direct labor.Altima uses a predetermined overhead allocation rate based on direct labor costs,which has been fixed at 40%.The entry to record the completion of the job should involve a ________.

• A) debit to Finished Goods Inventory $5158 and a credit to Materials Inventory $5158
• B) debit to Cost of Goods Sold $5158 and a credit to Finished Goods Inventory $5158
• C) debit to Finished Goods Inventory $5158 and a credit to Work-in-Process Inventory $5158
• D) debit to Work-in-Process Inventory $5158 and a credit to Finished Goods Inventory $5158

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Definitions:

Gross Earnings

The total income earned by an individual or a business before any deductions or taxes are subtracted.

Old Age Survivors and Disability Insurance (OASDI)

A federal program in the United States that provides retirement, disability, and survivor benefits, commonly known as Social Security.

Hospital Insurance (HI)

A form of healthcare insurance that covers medical and surgical expenses incurred in a hospital, often part of broader national or private health insurance plans.

Matching Social Security

Matching Social Security is the process where employers contribute an amount equal to the Social Security taxes withheld from their employees' wages, as part of the federal Social Security program.