Echher Corporation Uses a Job-Order Costing System and Applies Overhead

question 253

Multiple Choice

Echher Corporation uses a job-order costing system and applies overhead to jobs using a predetermined overhead rate. During the year the company's Finished Goods inventory account was debited for $218,000 and credited for $218,500. The ending balance in the Finished Goods inventory account was $13,000. At the end of the year, manufacturing overhead was overapplied by $36,700.If the applied manufacturing overhead was $223,900, the actual manufacturing overhead cost for the year was:

• A) $200,700
• B) $260,600
• C) $200,200
• D) $187,200

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Definitions:

Securities Act of 1933

A U.S. federal law, also known as the "truth in securities" law, which requires that investors receive financial and other significant information concerning securities being offered for public sale.

Qualified Opinions

In the context of auditing, these are statements made by an auditor expressing certain reservations about the financial health or the bookkeeping practices of a firm while generally certifying the financial statements as accurate.

Disclaimers of Opinions

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Unaudited Financial Statements

Financial reports that have not undergone a formal examination by an independent certified public accountant or auditing firm.