Which of the Following Entries Is Used to Record Direct

question 120

Multiple Choice

Which of the following entries is used to record direct materials purchased and used in production during a month in the Assembly department, before transferring the goods to Testing department?

• A) Debit: Work in Process-Assembly Credit: Wages Payable Control
• B) Debit: Accounts Payable Control Credit: Work in Process-Assembly
• C) Debit: Work in Process-Assembly Credit: Accounts Payable Control
• D) Debit: Accounts Payable Control Credit: Cash

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Definitions:

Investment in Associate

Investment in another entity where the investor has significant influence over the investee but does not control or jointly control it, usually represented by ownership of 20% to 50% of the voting stock.

Share Capital

The funds raised by a company through the issuance of shares to investors, representing the equity stake of shareholders.

Retained Earnings

The portion of a company’s profits that is kept or retained and not distributed to shareholders as dividends.

General Reserve

Funds set aside from profits for undisclosed general purposes, serving as a buffer for future financial uncertainties or for any identified but not immediate needs.