Question

Account balances from the Boilermakers Company are as follows: Manufacturing Overhead Work in Process Finished Goods Cost of Goods Sold $240,000 underapplied 100,000 300,000 800,000 If underspplied or overapplied overhead is material and is allocated to Work in Process, Finished Goods, and Cost of Goods Sold (based on ending account balances), Cost of Goods Sold after adjustment would have a balance of Select one: a. $1,440,000 b. S 640,000 c. S 960,000 d. $1,040,000 If operations run on less than full capacity, what is the result on cost driver rates? Select one: a. They can either too high or too low. b. They are too high. c. They are too low d. They are not affected. Consumption ratio is defined as:

Answer 1

Az OPTION - "C" 3 Allocated to Cost of Goods Sold Underapplied Overhead x balance of cost Goods Sol Total Inventory batance $ 2,40,000 X $ 8,00,000 $ 1500,000 $ 192,00,00,00,000 $ 12,00,000 $160,000 Hence, Balance of 와 Cast of Goods Sold ofter adjustment $ 8,00,000 + $ 160,000 $ 9.60,000 93) OPTION-'C' If operatione sun an lose.than fill capacity, what is the result on cost driver dates, they are too low.