Dacosta Corporation Had Only One Job in Process on May

question 8

Multiple Choice

Dacosta Corporation had only one job in process on May 1. The job had been charged with $1,800 of direct materials, $6,966 of direct labor, and $9,936 of manufacturing overhead cost. The company assigns overhead cost to jobs using the predetermined overhead rate of $18.40 per direct labor-hour.
During May, the following activity was recorded:
Work in process inventory on May 30 contains $3,741 of direct labor cost. Raw materials consist solely of items that are classified as direct materials.
-The entry to dispose of the underapplied or overapplied manufacturing overhead cost for the month would include a:

• A) credit of $5,336 to Manufacturing Overhead.
• B) credit of $1,660 to Manufacturing Overhead.
• C) debit of $5,336 to Manufacturing Overhead.
• D) debit of $1,660 to Manufacturing Overhead.

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Definitions:

68-95-99.7 Rule

A statistical rule stating that in a normal distribution, about 68% of observed values fall within one standard deviation, 95% within two, and 99.7% within three standard deviations of the mean.

Normally Distributed

Describes a statistical distribution where data points are symmetrically distributed around the mean, forming a bell-shaped curve.

Standard Deviation

A statistical measure that represents the amount of variation or dispersion from the average in a set of data.

Assignable Cause

A specific factor or reason for variation in a process that can be identified and managed.