On November 1,2012,The Bagel Factory Signed a $100,000,6%,six-Month Note Payable

question 64

Multiple Choice

On November 1,2012,The Bagel Factory signed a $100,000,6%,six-month note payable with the amount borrowed plus accrued interest due six months later on May 1,2013.The Bagel Factory should report interest payable at December 31,2012,in the amount of:

• A)$0.
• B)$1,000.
• C)$2,000.
• D)$3,000.

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Definitions:

Budgeted Capacity

The amount of production volume planned for a period, which is used for budgeting and planning purposes.

Overhead Costs

General business expenses that are not directly attributable to creating a product or service but are necessary for the business's functioning.

Cost Drivers

Factors that cause the cost of an activity or product to increase or decrease, influencing overall expenses.

Multiple-Departmental Overhead Rates

A cost accounting approach that assigns overhead costs to products or services based on the specific departmental resources they consume.