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Chatam Company Wrote a Check to Cover the Rent for May

Question 72

Multiple Choice

Chatam Company wrote a check to cover the rent for May. The total of the check was $20,000; the controller estimates that 80% of the square footage of the company was taken up by the factory and 20% by the accounting and administrative offices. The journal entry to record this check should be:


A) Debit Rent Expense $20,000 and credit Cash $20,000
B) Debit Rent Expense $4,000, debit Manufacturing Overhead $16,000 and credit Cash $20,000
C) Debit Manufacturing Overhead $20,000 and credit Rent Expense $20,000
D) Debit Rent Expense $4,000, debit Manufacturing Overhead $16,000 and credit Accumulated Depreciation
E) $20,000

Correct Answer:

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