The actual manufacturing overhead incurred at Hogans Corporation during April wa

Question

The actual manufacturing overhead incurred at Hogans Corporation during April was $51,800, while the manufacturing overhead applied to Work in Process was $66,000. The company's Cost of Goods Sold was $281,000 prior to closing out its Manufacturing Overhead account. The company closes out its Manufacturing Overhead account to Cost of Goods Sold. Which of the following statements is true?

The actual manufacturing overhead incurred at Hogans Corporation during April was $51,800, while the manufacturing overhead applied to Work in Process was $66,000. The company's Cost of Goods Sold was $281,000 prior to closing out its Manufacturing Overhead account. The company closes out its Manufacturing Overhead account to Cost of Goods Sold. Which of the following statements is true?

Explanation / Answer

Hi,

Please find the answer as follows:

Option C is correct.

Notes:

Manufacturing Overhead Applied = 66000

Manufacturing Overhead Incurred = 51800

Manufacturing Overhead Overapplied = 66000 - 51800 = 14200

Cost of Good Sold after Closing Out = 281000 - 14200 = 266800

Thanks.

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