Gest Inc.has provided the following data for the month of November.The balance in the Finished Goods inventory account at the beginning of the month was $49,000 and at the end of the month was $45,000.The cost of goods manufactured for the month was $226,000.The actual manufacturing overhead cost incurred was $74,000 and the manufacturing overhead cost applied to Work in Process was $70,000.The adjusted cost of goods sold that would appear on the income statement for November is:
A)$226,000
B)$230,000
C)$222,000
D)$234,000

Question

Quizplus · Accepted Answer

Manufacturing overhead underapplied (overapplied)= Actual manufacturing overhead incurred - Manufacturing overhead applied = $74,000 - $70,000 = $4,000 underapplied
Adjusted cost of goods sold = Beginning finished goods inventory + Cost of goods manufactured - Ending finished goods inventory + Manufacturing overhead underapplied
= $49,000 + $226,000 - $45,000 + $4,000
= $234,000

Gest IncHas Provided the Following Data for the Month of November