Which of the Following Is True Regarding Kitty's Statement That

question 65

Multiple Choice

Which of the following is true regarding Kitty's statement that she had no personal liability?

• A) She was correct.
• B) She was correct only if she can establish that she has paid all her business taxes on time.
• C) She was correct only if she can establish that she has at least 5 employees.
• D) She was incorrect.
• E) She was incorrect unless she signed an agreement with a financial institution in order to get a loan for the business and agreed in the document that she would not accept personal liability for any losses.

---

Definitions:

Work In Process Inventory

Items in the production process that are not yet finished products, including material, labor, and overhead costs applied to them.

Actual Manufacturing Overhead Costs

The incurred expenses related to producing goods that are not directly tied to the product such as utilities, rent, and maintenance.

Overapplied Overhead

A situation where the allocated manufacturing overhead costs for a period exceed the actual overhead costs incurred.

Manufacturing Overhead Costs

All indirect costs associated with the production process, such as utilities, rent, and salaries for non-direct labor.