The Pitter Corporation Purchased a Notebook Computer for $3,000 on December

question 38

Multiple Choice

The Pitter Corporation purchased a notebook computer for $3,000 on December 1. The useful life of the notebook computer is estimated to be 5 years. If financial statements are to be prepared on December 31, the company should make the following adjusting entry:

• A) debit depreciation expense, $600; credit accumulated depreciation, $600.
• B) debit depreciation expense, $50; credit accumulated depreciation, $50.
• C) debit depreciation expense, $2,400; credit accumulated depreciation, $2,400.
• D) debit office equipment, $50; credit accumulated depreciation, $50.

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Definitions:

Direct Labor Hour

A measure of the amount of time workers spend directly manufacturing a product.

Direct Materials

Raw materials that can be directly traced to the production of specific goods or services and are significant in cost.

Total Cost

The complete amount of costs involved in producing, purchasing, and/or selling goods or services, including fixed and variable costs.

Inventory Information

Details about the quantities, locations, and values of a company's inventory, used for managing and reporting purposes.