A metal shop's employees work overtime to finish an order that is sold on March 28. The office sends a statement to the customer in early April and payment is received by mid-April. The overtime wages should be expensed in
A) March.
B) April.
C) the period when the workers receive their checks.
D) either in March or April depending on when the pay period ends.

Question

Quizplus · Accepted Answer

Overtime wages should be expensed in the period the work was performed to match the expense with the revenue it helped generate, which is March in this case.

A Metal Shop's Employees Work Overtime to Finish an Order