Marshall Enterprises charged the following amounts of overhead to jobs during the year: $20,000 to jobs still in process,$60,000 to jobs completed but not sold,and $120,000 to jobs finished and sold.At year-end,Marshall Enterprise's Factory Overhead account has a credit balance of $5,000,which is not a material amount.What entry should Marshall make at year-end?
A)No entry is needed.
B)Debit Factory Overhead $5,000;credit Cost of Goods Sold $5,000.
C)Debit Cost of Goods Sold $5,000;credit Factory Overhead $5,000.
D)Debit Factory Overhead $5,000;credit Work in Process Inventory $5,000.
E)Debit Factory Overhead $5,000;credit Finished Goods Inventory $5,000.

Question

Quizplus · Accepted Answer

The credit balance in Factory Overhead represents overapplied overhead. Overapplied overhead is debited to Factory Overhead and credited to Cost of Goods Sold.

Marshall Enterprises Charged the Following Amounts of Overhead to Jobs