What would be the balance of Cost of Goods Sold after writing off the difference between applied and actual factory overhead directly to Cost of Goods Sold?

FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
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Moira Company has just finished its first year of operations and must decide which
method to use for adjusting cost of goods sold. Because the company used a
budgeted indirect-cost rate for its manufacturing operations, the amount of
manufacturing overhead applied was $435,000 and actual amount of manufacturing
overhead incurred was $425,000.
Ending balances in the relevant accounts were:
Work-in-Process
Finished Goods
Cost of Goods Sold
$ 40,000
80,000
680,000
What would be the balance of Cost of Goods Sold after writing off the difference
between applied and actual factory overhead directly to Cost of Goods Sold?
Transcribed Image Text:Moira Company has just finished its first year of operations and must decide which method to use for adjusting cost of goods sold. Because the company used a budgeted indirect-cost rate for its manufacturing operations, the amount of manufacturing overhead applied was $435,000 and actual amount of manufacturing overhead incurred was $425,000. Ending balances in the relevant accounts were: Work-in-Process Finished Goods Cost of Goods Sold $ 40,000 80,000 680,000 What would be the balance of Cost of Goods Sold after writing off the difference between applied and actual factory overhead directly to Cost of Goods Sold?
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