If the Sum of the Debits and Credits in a Trial

question 95

Multiple Choice

If the sum of the debits and credits in a trial balance is not equal,then

• A)there is no concern because the two amounts are not meant to be equal.
• B)the chart of accounts also does not balance.
• C)it is safe to proceed with the preparation of financial statements.
• D)most likely an error was made in posting journal entries to the general ledger or in preparing the trial balance.

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Definitions:

Direct Labor-Hours

The complete tally of hours that employees dedicate to the manufacturing process.

Unit Product Cost

The aggregate expenditure linked with manufacturing an individual product unit, covering materials, employee wages, and overhead expenses.

Predetermined Overhead Rate

A rate established in advance to allocate overhead costs to products or job orders, based on an expected activity level.

Machine-Hours

A measure of the amount of time machines are run, often used as a base for allocating factory overhead.