The Mangum Steel Corporation manufactures sheet metal for the automotive industry. Each month, Sue, the accountant, calculates and posts factory overhead. The following information was available for the month of July; Depreciation Expense of $35, 000; Utility Expense $11, 350; Insurance Expense $620; Miscellaneous Expense $359; Payroll Taxes Expense $16, 456; Supplies Expense $3, 159; Federal Income Tax Expense, $25, 000; and Cost of Goods Sold Expense of $34, 000. Jo needs to calculate factory overhead and create the journal entry. What is the journal entry to record this transaction?

INTRODUCTION TO COST ACCOUNTING

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Question [CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]

A	Debit Factory Overhead for $91, 944, Credit Individual Expense Accounts for $91, 944
B	Debit Factory Overhead for $125, 944, Credit Individual Expense Accounts for $125, 944
C	Debit Factory Overhead for $66, 944, Credit Individual Expense Accounts for $66, 944
D	Debit Factory Overhead for $100, 944, Credit Individual Expense Accounts for $100, 944

Explanation:

Detailed explanation-1: -Sheetmetal generally comes in three forms-mild steel, aluminum, and stainless steel. Of these, aluminum and mild steel are by far the most commonly used for automotive projects.

Detailed explanation-2: -The main factors for selecting the material, especially for the automobile body, are numerous and include thermal, chemical or mechanical resistance, easy manufacturing, durability and many other mechanical properties including cost and availability of course.

Detailed explanation-3: -The arguments for alternative materials concentrate on weight reduction and fuel efficiency, better performance, tooling cost, and environmental friendliness.

Detailed explanation-4: -In cars, steel is used to create the underlying chassis or cage beneath the body that forms the skeleton of the vehicle and protects you in the event of a crash. Door beams, roofs and even body panels created during auto manufacturing are made of steel on most cars today.

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