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

question 3

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.
-The balance in the Finished Goods inventory account at the beginning of the year was:

• A) $13,500
• B) $36,700
• C) $500
• D) $13,000

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Definitions:

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The act of giving money in exchange for goods, services, or to fulfill any obligations such as dividends to shareholders.

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A financial product that pays out a fixed stream of payments to an individual, primarily used as an income stream for retirees.

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The charge for borrowing money or the return on investment for lending money, typically expressed as a annual percentage rate.

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Funds committed into ventures with the expectation of earning a return or profit.