Question

Beshaw Inc. has provided the following data for the month of January. There were no beginning inventories, consequently, the direct materials, direct labor, and manufacturing overhead applied listed below are all for the current month. Direct materials Direct labor Manufacturing overhead applied Total Cost of Work In Finished Goods Process Goods Sold Total $ 3,440 $ 8,450 $ 61,880 $ 73, 770 6,160 16,250 119,000 141,410 3,300 6,050 45,650 55,000 $12,900 $30,750 $226,530 $270, 180 Manufacturing overhead for the month was underapplied by $7,000. The Corporation allocates any underapplied or overapplied manufacturing overhead among work in process, finished goods, and cost of goods sold at the end of the month on the basis of the manufacturing overhead applied during the month in those accounts. The cost of goods sold for January after allocation of any underapplied or overapplied manufacturing overhead for the month is closest to: Multiple Choice O $233,530 O $220,720 O $219,530 O $232,340

Answer 1

Beshaw Inc
Cost of goods sold before adjustment	226530
(+) Underapplied overhead allocation [ 7000 * 45650 / 55000 ]	5810
Cost of goods sold after adjustment	232340

Gurtner Corporation
Cost of goods manufactured	170000
(+) Beginning finished goods inventory	33000
(-) Ending finished goods inventory	40000
Unadjusted cost of goods sold	163000
(+) Underapplied overhead	4000
Adjusted cost of goods sold	167000