Question

Hsu Company incurred $90,000 of depreciation for the year. Eighty percent relates to the firm's production facilities, and 20% relates to sales and administrative offices. If all items are handled in the proper manner, a review of the company's accounting records should reveal a:

Answer 1

debit to MOH for $72,000

Step-by-step explanation:

MOH which is regarded as

Manufacturing overhead cost, and is the total of indirect costs spend during manufacturing process of a particular product.

From the question, we are informed that the Company incurred $90,000 of depreciation for the year. Eighty percent relates to the firm's production facilities, and 20% relates to sales and administrative offices.

Then, 80% of $90,000= (0.80×90000)=72,000

Then the MOH is $72,000 which can be recorded in company's accounting records as MOH.