Total Manufacturing-Related Costs Incurred by Alloy Company in October for All

question 115

Multiple Choice

Total manufacturing-related costs incurred by Alloy Company in October for all its jobs is as follows: $$\begin{array} { l r } \text { Direct materials } & \$ 1000 \\\text { Insurance of factory building } & 160 \\\text { Direct labor } & 1,400 \\\text { Property taxes-factory building } & 700 \\\text { Other factory overhead costs } & 1,550 \\\text { Factory overhead applied } & 1,950\end{array}$$ Assuming Alloy uses a normal costing system and applies overhead based on a predetermined rate, what is the credit to Overhead Control to close the account at the end of the year?

• A)$560
• B)$460
• C)$1,250
• D)$1,320

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Definitions:

Demand Function

A mathematical relationship that describes how the quantity demanded of a good or service varies with changes in its price, and possibly other factors.

Horizontal Labor Supply Curve

A graphical representation suggesting that a worker's willingness to work does not change regardless of wage increases over a certain range.

Monopolist

A single seller in a market who has significant control over the price and supply of a product or service.

Horizontal Labor Supply Curve

Suggests that the supply of labor remains constant regardless of changes in wage rates.