At end of the year, a company has a $1,200 positive balance in Manufacturing Overhead. The company:

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At end of the year, a company has a $1,200 positive balance in Manufacturing Overhead. The company:

a. Makes an adjustment by increasing Manufacturing Overhead Applied for $1,200 and decreased Manufacturing Overhead for $1,200.

b. Makes an adjustment by increasing Manufacturing Overhead Expense for $1,200 and decreasing Manufacturing Overhead for $1,200.

c. Makes an adjustment by increasing Cost of Goods Sold for $1,200 and decreasing Manufacturing Overhead for $1,200.

d. Makes no adjustment because differences between actual overhead and the amount applied are a normal part of job order costing and will average out over the next year.

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