Luca Company Over Applied Manufacturing Overhead During 2016

question 51

Multiple Choice

Luca Company over applied manufacturing overhead during 2016.Which one of the following is part of the year-end entry to dispose of the over-applied amount assuming the amount is material?

• A)an increase to Finished Goods
• B)a decrease to Applied Overhead
• C)a decrease to Work in Process Inventory
• D)an increase to Cost of Goods Sold

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Definitions:

Freight Terms

Conditions in a shipping agreement that define the responsibilities of buyers and sellers, including who pays for shipping, insurance, and other costs.

Goods

Tangible items that are manufactured or produced for sale and use, often referring to items of merchandise or inventory.

Right of Return

The right of return is a policy that allows customers to return purchased goods within a specified period for a refund, exchange, or credit.