Which of the Following Transactions Will Cause a Liability to Be

question 48

Multiple Choice

Which of the following transactions will cause a liability to be credited and an asset account to be debited when the perpetual inventory system is in use?

• A) Recorded the adjustment for depreciation
• B) Recorded the adjustment for the consumption of supplies
• C) Purchased merchandise inventory on account
• D) Purchased office supplies on account

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Definitions:

Direct Labour-Hours

The total hours worked by employees directly involved in manufacturing a product.

Variable Manufacturing Overhead

Manufacturing costs that vary in total directly with changes in production volume, such as utility costs or raw material consumptions.

Direct Materials

Raw materials that are directly traceable to the manufacturing of a specific product.

Actual Hours

The real number of hours worked, as opposed to planned or scheduled hours.