If Direct Labor for the Month Is $40,000,overhead Is Applied

question 66

Multiple Choice

If direct labor for the month is $40,000,overhead is applied based on direct labor,annual overhead is $600,000,and annual direct labor is $1,000,000,what is the entry to charge direct labor to production?

• A)Debit Work-in-Process Inventory $40,000; credit Payroll $40,000
• B)Debit Overhead-Applied $40,000; credit Work-in-Process Inventory $40,000
• C)Debit Work-in-Process Inventory $24,000; credit Overhead-Applied $24,000
• D)Debit Work-in-Process Inventory $66,000; credit Overhead-Applied $66,000

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Definitions:

Dividend Yield Ratio

A financial ratio that indicates how much a company pays out in dividends each year relative to its stock price.

Market Price

The current price at which an asset or service can be bought or sold in the marketplace.

Stock Split

An action by a company to divide its existing shares into multiple shares to boost the liquidity of the shares.

Par Value

The nominal value per share of stock as specified in the corporate charter; also, another name for bond principal, or the maturity amount of a bond (in Chapter 10).