The cost of goods sold in a single product company is equal to the number of units sold multiplied by any overapplied overhead or underapplied overhead.

Question

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The cost of goods sold in a single product company is equal to the number of units sold multiplied by the unit cost (including direct materials, direct labor, and manufacturing overhead). Over or under applied overhead is typically adjusted at the end of the accounting period through a journal entry, but it is not included in the cost of goods sold calculation.

The Cost of Goods Sold in a Single Product Company