Which of the Following Would Be Included in the Entry

question 25

Multiple Choice

Which of the following would be included in the entry to dispose of the under- or over applied overhead cost for the month?

• A) A debit of $50 to Cost of Goods Sold.
• B) A debit of $50 to Manufacturing Overhead.
• C) A debit of $5,500 to Manufacturing Overhead.
• D) A credit of $5,500 to Cost of Goods SolD.
• OH applied = 26,500 * .7 = 18,550 less actual of 18,500 = $50 overapplieD.

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Definitions:

Supply and Demand

Fundamental economic model based on the idea that the price and quantity of a good or service is determined by the availability (supply) and desire (demand) of that good or service.

Rationing Mechanism

A system used to allocate scarce goods and services using criteria other than price.

Surplus

An excess of supply over demand, resulting in an accumulation of unsold products or unused resources.

Equilibrium Price

The cost at which the amount of a product or service that consumers want to buy matches the amount that producers are willing to sell, resulting in a balanced market situation.