Manufacturing overhead has an underallocated balance of $6,200; raw materials inventory balance is $50,000; work in process inventory is $30,000; finished goods inventory is $20,000; and cost of goods sold is $100,000. Using this information, which account would have an opening credit balance?

Question

Quizplus · Accepted Answer

Manufacturing overhead with an underallocated balance indicates additional costs need to be allocated to products. This does not directly result in an opening credit balance in the Raw Materials, Finished Goods, or Work-in-Process Inventory accounts. These accounts typically have debit balances, reflecting the cost of materials, work in progress, and finished goods, respectively.

Manufacturing Overhead Has an Underallocated Balance of $6,200; Raw Materials