Altima Company Finished Job A40 on the Last Working Day

question 80

Multiple Choice

Altima Company finished Job A40 on the last working day of the year. It utilized $400 of direct materials and $3,600 of direct labor. Altima uses a predetermined overhead allocation rate based on percentage of direct labor costs which has been fixed at 40%. The entry to record the completion of the job should involve a:

• A)debit to Finished Goods Inventory $5,440 and a credit to Materials Inventory $5,440.
• B)debit to Cost of Goods Sold $5,440 and a credit to Finished Goods Inventory $5,440.
• C)debit to Finished Goods Inventory $5,440 and a credit to Work-in-Process Inventory $5,440.
• D)debit to Work-in-Process Inventory $5,440 and a credit to Finished Goods Inventory $5,440.

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Definitions:

Zygote

The cell that is formed from the union of the egg and sperm.

Mesoderm

The middle layer of an embryo in early development, which gives rise to muscles, bones, and other connective tissues.

Ectoderm

The outermost layer of cells or tissue of an embryo in early development, giving rise to the outer layer of skin and nervous system.

Endoderm

The innermost layer of cells or tissue of an embryo in early development, which gives rise to the linings of the digestive and respiratory systems.