Estimated Overhead and Direct Labor Costs for the Year Were

question 143

Multiple Choice

Estimated overhead and direct labor costs for the year were $250,000 and $125,000, respectively. During the year, actual overhead was $248,000 and actual direct labor cost was $123,000. The entry to close the over- or under-applied overhead at year-end, assuming an immaterial amount, would include:

• A) A debit to Cost of Goods Sold for $2,000.
• B) A debit to Factory Overhead for $2,000.
• C) A credit to Finished Goods Inventory for $2,000.
• D) A debit to Goods in Process Inventory for $2,000.
• E) A credit to Cost of Goods Sold for $2,000.

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Definitions:

Oxygen Saturation

The percentage of hemoglobin binding sites in the bloodstream occupied by oxygen, a critical measure of respiratory efficiency.

Thorax Expands

The increase in chest volume during inhalation, facilitated by the muscles of respiration, allowing air to enter the lungs.

Trachea

The windpipe, a large membranous tube with cartilage rings that conveys inhaled air from the larynx to the bronchi.

Capillary Refill

A quick test to assess circulatory status by pressing on a fingernail or skin to see how quickly blood returns after being blanched.