Mango Company Applies Overhead Based on Direct Labor Costs

question 89

Multiple Choice

Mango Company applies overhead based on direct labor costs.For the current year,Mango Company estimated total overhead costs to be $300,000,and direct labor costs to be $150,000.Actual overhead costs for the year totaled $330,000,and actual direct labor costs totaled $170,000.
-At year-end,the balance in the Factory Overhead account is a:

• A)$330,000 Debit balance.
• B)$170,000 Debit balance.
• C)$10,000 Credit balance.
• D)$340,000 Credit balance.
• E)$10,000 Debit balance.

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Definitions:

Raw Materials Inventory

The total cost of all the materials that are used in the production of finished goods that have not yet been used.

Inventory Turnover

A financial ratio that measures how often a company's inventory is sold and replaced over a certain period, indicating the efficiency of inventory management.

Net Income

The company's financial gain remaining after deducting all expenses and tax liabilities from its revenue.

Calculate

To determine mathematically the amount or number of something, often involving the use of specific formulas or models.