Becky Works on the Assembly Line of a Manufacturing Company

question 3

Multiple Choice

Becky works on the assembly line of a manufacturing company where she installs a component part for one of the company's products.She is paid $16 per hour for regular time and time and a half for all work in excess of 40 hours per week.
-Becky's employer offers fringe benefits that cost the company $3 for each hour of employee time (both regular and overtime) .During a given week,Becky works 42 hours but is idle for 3 hours due to material shortages.The company treats all fringe benefits relating to direct labor as added direct labor cost and the remainder as part of manufacturing overhead.The allocation of Becky's wages and fringe benefits for the week between direct labor cost and manufacturing overhead would be:

• A)Choice A
• B)Choice B
• C)Choice C
• D)Choice D

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Definitions:

Merchandise Sold

Pertains to the goods that have been sold to customers by a company during a specific period, often accounted for in the sales revenue section of an income statement.

Accounts Payable

The amount a company owes on short-term debts to its vendors or suppliers.

Investing Activities

Part of the cash flow statement that details cash inflow and outflow related to the purchase and sale of long-term investments and assets.

Financing Activities

Transactions related to changes in the equity and debt of an organization, including issuing shares, paying dividends, and borrowing funds.