Valor Company Is Planning to Implement an Activity-Based Costing (ABC)system

question 70

Multiple Choice

Valor company is planning to implement an activity-based costing (ABC) system to apply overhead costs to products.Three activities were identified and rates were calculated for each activity.

Assume 600 purchase requisitions were processed,1,200 production setups were performed,and 300 products were inspected for the year.Which of the following journal entries would be made by Valor to record the application of overhead?

• A)Work in Process Inventory 36,000 Manufacturing Overhead 36,000
• B)Manufacturing Overhead 36,000 Work in Process Inventory 36,000
• C)Manufacturing Overhead 36,000 Finished Goods Inventory 36,000
• D)Finished Goods Inventory 36,000 Work in Process Inventory 36,000
• E)None of the answer choices is correct.

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Definitions:

New Netherland

A 17th-century colonial province of the Dutch Republic that included parts of what are now New York, New Jersey, Delaware, and Connecticut.

Petrus Stuyvesant

The last Dutch Director-General of the colony of New Netherland until it was ceded to the English in 1664, known for his efforts to strengthen the colony's defenses and manage relations with Native Americans.

Dutch Reformed Church

A Protestant denomination that originated in the early 16th century during the Reformation in the Netherlands, with doctrines rooted in Calvinism.

Quakers

Members of the Religious Society of Friends, a Christian movement known for its commitment to pacifism, equality, and social justice.