Question

Matthias Corporation has provided data concerning the Corporation's Manufacturing Overhead account for the month of May. Prior to the closing of the overapplied or underapplied balance to Cost of Goods Sold, the total of the debits to the Manufacturing Overhead account was $63,000 and the total of the credits to the account was $89,000. Which of the following statements is true?

Multiple Choice

• Manufacturing overhead for the month was underapplied by $26,000.

• Manufacturing overhead transferred from Finished Goods to Cost of Goods Sold during the month was $63,000.

• Manufacturing overhead applied to Work in Process for the month was $89,000.

• Actual manufacturing overhead incurred during the month was $89,000.

Answer 1

Answer:

Manufacturing overhead applied to Work in Process for the month was $89,000

Explanation:

Manufacturing overhead Account
Debit		Credit
Actual overhead	$63,000	Work in process [Applied overhead]	$89,000
Over-applied	$26,000
Total	$89,000	Total	$89,000

.

• Manufacturing overhead for the month was Over-applied by $26,000. So, Option-i is incorrect.

• $63,000 is actual manufacturing overhead. So, option-ii is incorrect.

• Manufacturing overhead applied to Work in Process for the month was $89,000. it is correct.

• Actual manufacturing overhead incurred during the month was $63,000. So, Option-iv is incorrect.

.

Thus,

Option-iii is correct.