Selected Items from the Balance Sheet and Income Statement Are

question 10

Essay

Selected items from the balance sheet and income statement are shown below for the Carswell Corporation for 2017 and 2016.Calculate the amount of the change and the percentage change for each item.
$\begin{array}{lll}&2017&2016\\\text { Cash } & \$ 130,000 & \$ 100,000 \\\text { Accounts receivable } & 100,000 & 125,000 \\\text { Merchandise inventory } & 65,000 & 85,000 \\\text { Accounts payable } & 62,500 & 50,000 \\\text { Sales } & 150,000 & 135,000 \\\text { Cost of goods sold } & 73,500 & 67,500\end{array}$

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Definitions:

Overapplied

A situation in cost accounting where the allocated overhead costs exceed the actual overhead costs.

Finished Goods Inventory

The stock of completed products that are ready to be sold.

Underapplied

Describes the situation where the allocated manufacturing overhead is less than the actual manufacturing overhead incurred.

Overapplied

A situation in which the allocated manufacturing overhead cost is more than the actual overhead cost incurred.