Which of the Following Is Correct with Respect to Closing

question 99

Multiple Choice

Which of the following is correct with respect to closing out overapplied manufacturing overhead to Cost of Goods Sold versus closing it out to Cost of Goods Sold and Finished Goods and Work in Process inventories?

• A)The balance in the Work in Process account after allocation will be higher if the overapplied manufacturing overhead is closed out by allocating it to all appropriate accounts.
• B)The balance in the Work in Process account after allocation will be the same under either method.
• C)Net operating income will be higher if all of the overapplied manufacturing overhead is closed out to Cost of Goods Sold.
• D)Cost of Goods Sold will be lower if the overapplied manufacturing overhead is closed out by allocating it to the inventory accounts as well as to Cost of Goods Sold.

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Definitions:

Brainstorming

A creativity technique by which efforts are made to find a conclusion for a specific problem by gathering a list of ideas spontaneously contributed by its members.

Satisfactions

The feelings of pleasure or fulfillment that come from meeting one's needs, expectations, or goals.

Social Relationships

Connections between individuals or groups based on interaction and mutual influence.

Therapeutic Groups

Groups designed to provide psychological therapy, where members share their experiences and support each other under the guidance of a trained therapist.