If a Transaction Is Properly Analyzed and Recorded

question 21

Multiple Choice

If a transaction is properly analyzed and recorded,

• A) only two accounts will be used to record the transaction.
• B) one account balance will increase and another will decrease.
• C) one asset account will be debited and one liability account will be credited.
• D) the total amount debited will equal the total amount credited.

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Definitions:

Manufacturing Overhead

This includes all indirect manufacturing costs that cannot be directly attributed to specific units produced, such as utilities or salaries for factory supervisors.

Work In Process

A phase in manufacturing where items are partially completed but not yet ready for sale.

Job Cost Sheet

A form that records the direct materials, direct labor, and manufacturing overhead cost charged to a job.

Fire Insurance

A type of property insurance that covers damage and losses caused by fire.