Yamada Company Applies Factory Overhead to Its Production Departments on the Basis

Yamada Company applies factory overhead to its production departments on the basis of 90% of direct labor costs. In the Assembly Department, Yamada had $125,000 of direct labor cost, and in the Finishing Department, Yamada had $35,000 of direct labor cost. The entry to apply overhead to these production departments is:

A) Debit Factory Overhead $144,000; credit Work in Process Inventory-Assembly $112,500; credit Work in Process-Finishing $31,500.
B) Debit Factory Overhead-Assembly $112,500; debit Factory Overhead-Finishing $31,500; credit Work in Process Inventory $144,000.
C) Debit Factory Payroll $144,000; credit Cash $144,000.
D) Debit Factory Overhead $144,000; credit Factory Payroll $144,000.
E) Debit Work in Process Inventory-Assembly $112,500; debit Work in Process Inventory -Finishing $31,500; credit Factory Overhead $144,000.