In a Perpetual Inventory System,when Cash Sales Are Recorded,________

question 60

Multiple Choice

In a perpetual inventory system,when cash sales are recorded,________.

• A) merchandise inventory decreases and cost of goods sold decreases
• B) sales revenue increases and cash decreases
• C) sales revenue increases and cost of goods sold decreases
• D) merchandise inventory decreases and cost of goods sold increases

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Definitions:

Direct Labor-Hours

Entire duration of work by employees intricately involved in the manufacturing phase.

Machine-Hours

A measure of production output or activity calculated as the total hours that machines are operated over a specific period.

Standard Hours Allowed

The amount of work time allowed for the completion of a task, against which actual hours are compared for performance analysis.

Direct Labor-Hours

Total time directly invested in the creation of a product or the provision of a service.