At the Current Year-End, Hardly Company Found That Its Overhead

question 133

Multiple Choice

At the current year-end, Hardly Company found that its overhead was underapplied by $2,500, and this amount was not deemed to be a material amount. Based on this information, Hardly should

• A) Close the $2,500 to Cost of Goods Sold.
• B) Close the $2,500 to Finished Goods Inventory.
• C) Do nothing about the $2,500, since it is not material, and it is likely that overhead will be overapplied by the same amount next year.
• D) Carry the $2,500 to the income statement as "Other Expense".
• E) Carry the $2,500 to the next period.

Recognize the procedure for adjusting trial balances and its purpose.

Understand how to prepare financial statements from adjusted trial balances and end-of-period spreadsheets.

Comprehend the importance and the process of preparing post-closing trial balances.

Identify and analyze information from an adjusted trial balance.

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Definitions:

GTT

An acronym for glucose tolerance test, a test to measure the body's ability to metabolize glucose.

Upper Genital

Refers to the upper part of the female reproductive system, primarily involving the uterus, fallopian tubes, and ovaries.

Abdomen

The part of the body that lies between the chest and pelvis, containing most of the digestive system organs and often referred to as the belly.

Pregnancy

The condition of being pregnant, involving the development of a fetus in a woman's uterus.