If Direct Labor for the Month Is $30,000,overhead Is Applied

question 63

Multiple Choice

If direct labor for the month is $30,000,overhead is applied based on direct labor,annual overhead is estimated to be $500,000,and annual direct labor is estimated to be $800,000,what is the entry to apply overhead to production?

• A)Debit Work-in-Process Inventory $18,750; credit Payroll $18,750
• B)Debit Overhead-Applied $18,750; credit Work-in-Process Inventory $18,750
• C)Debit Work-in-Process Inventory $18,750; credit Overhead-Applied $18,750
• D)Debit Work-in-Process Inventory $30,000; credit Overhead-Applied $30,000

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Definitions:

Correlation

A statistical measure that describes the extent to which two variables change together.

Concurrent Validity

Refers to the extent to which the results of a particular test or measurement correspond to those of a previously established measurement for the same construct.

Error Of Measurement

The difference between a measured value and the true value due to limitations in measurement accuracy or technique.

Reliability

The extent to which a testing device delivers uniform and steady outcomes over time.