Staniszewski Inc. has provided the following data for the month of March There w

Question

Staniszewski Inc. has provided the following data for the month of March There were no beginning inventories; consequently, the direct materials, direct labor, and manufacturing overhead applied listed below are all for the current month. Work in Finished Cost of process Goods goods soldTotal Direct materials $4,030 $16.380 $98,540 $118.950 Direct labor2,110 11.340 68,220 Manufacturing OH applied 3,950 11,060 63.990 72.000 Total 81,670 $10.090 $38,780 $230,750 $279,620 Manufacturing overhead for the month was overapplied by $1,0 The company allocates any underapplied or overapplied manufacturing overhead among work in process, finished goods, and cost of goods sold at the end of the month on the basis of the overhead applied during the month in those accounts. The cost of goods sold for March after allocation of any underapplied or overapplied manufacturing overhead for the month is closest to:

Explanation / Answer

Overapplied overhead is closed by crediting cost of goods sold account. Since ovehead is overapplied by $1000, the cost of goods sold will be reduced by $1000 i.e. $230750-$1000=$229750.

Correct option is the fourth one.

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