Molano Corporation Has Provided the Following Data Concerning Manufacturing Overhead

Molano Corporation has provided the following data concerning manufacturing overhead for June:
The company's Cost of Goods Sold was $255,000 prior to closing out its Manufacturing Overhead account. The company closes out its Manufacturing Overhead account to Cost of Goods Sold. Which of the following statements is true?

A) Manufacturing overhead was underapplied by $7,000; Cost of Goods Sold after closing out the Manufacturing Overhead account is $248,000
B) Manufacturing overhead was overapplied by $7,000; Cost of Goods Sold after closing out the Manufacturing Overhead account is $248,000
C) Manufacturing overhead was underapplied by $7,000; Cost of Goods Sold after closing out the Manufacturing Overhead account is $262,000
D) Manufacturing overhead was overapplied by $7,000; Cost of Goods Sold after closing out the Manufacturing Overhead account is $262,000