Bill Submits a Time Card for a Non-Existent Employee

question 31

Multiple Choice

Bill submits a time card for a non-existent employee.The employer issues the payroll check.Bill forges the indorsement and negotiates the check to Ted.Which of the following statements holds true for this situation?

• A) The loss from the forged check is borne by the holder in due course.
• B) The check cannot be negotiated as it carries the signature of a non-existent person.
• C) The employer has the right to refuse payment to Ted.
• D) Ted submits the check to the employer and gets the mentioned amount.

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Definitions:

Raw Materials Inventory

A rephrased definition: Stock of basic materials awaiting use in the production process to create finished goods.

Direct Materials

Raw materials that are directly traceable to the manufacturing of a product and are considered a variable cost.

Indirect Materials

Materials used in the production process that cannot be directly linked to a specific product, such as lubricants and cleaning supplies used in machinery.

Factory Overhead

All indirect costs associated with manufacturing, excluding direct materials and direct labor, such as utilities, depreciation, and maintenance of factory equipment.