If Overhead Was Overapplied During the Accounting Period by an Insignificant

question 64

Multiple Choice

If overhead was overapplied during the accounting period by an insignificant amount,the entry to close the Manufacturing Overhead account will include a:

• A) Debit to Cost of Goods Sold and a credit to Manufacturing Overhead.
• B) Debit to Cost of Goods Sold and a credit to Finished Goods Inventory.
• C) Debit to Manufacturing Overhead and a credit to Cost of Goods Sold.
• D) Debit to Finished Goods Inventory and a credit to Manufacturing Overhead.

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Definitions:

Cross Rate

Exchange rate between two currencies computed by reference to a third currency, typically the US dollar.

Spot Market

A public market for trading financial instruments or commodities that are delivered immediately.

Trade Settled

The completion of a securities transaction when the seller delivers the security to the buyer and receives payment in return.

Purchasing Power Parity

An economic theory that compares different countries' currencies through a "basket of goods" approach, to assess relative currency value.