Sanker Inc

question 33

Multiple Choice

Sanker Inc. has provided the following data for the month of August. There were no beginning inventories; consequently, the direct materials, direct labor, and manufacturing overhead applied listed below are all for the current month. Manufacturing overhead for the month was overapplied by $5,000.
The company allocates any underapplied or overapplied overhead among work in process, finished goods, and cost of goods sold at the end of the month on the basis of the overhead applied during the month in those accounts.
-The work in process inventory at the end of August after allocation of any underapplied or overapplied overhead for the month is closest to:

• A) $18,593
• B) $18,780
• C) $17,080
• D) $17,267

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Definitions:

Fixed Ordering Costs

Fixed ordering costs are the expenses that do not change with the quantity of order and typically include things like delivery charges and order processing fees.

Inventory Value

The total cost or market value of all the goods and materials held by a company.

Accounts Receivable Balance

The total amount of money owed to a company by its customers for goods or services provided on credit.

Credit Sales

Sales made on credit, allowing the buyer to pay at a later date.