Question
A firm incurs $35,000,000 of actual OH costs. It has a PDOH rate of $450 per machine hour and 100,000 machine hours were actually consumed
A firm incurs $35,000,000 of actual OH costs. It has a PDOH rate of $450 per machine hour and 100,000 machine hours were actually consumed during the period. The firm has 0 units in beginning WIP, it started 250 units and completed 230 units. Only 15 completed units are still waiting for the sales to be finalized (i.e. not "sold" yet).
Which of the following is a feasible journal entry to close the Overhead Control account at the end of the period?
a. | Debit: Cost of Goods Sold $10,000,000 Credit: Overhead Control $10,000,000
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b. | Debit: WIP $800,000 Debit: Finished Goods $600,000 Debit: Cost of Goods Sold $8,600,000 Credit: Overhead Control $10,000,000 | |
c. | Debit: Overhead Control $10,000,000 Credit: Cost of Goods Sold $10,000,000
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d. | Debit: Overhead Control $10,000,000 Credit: WIP $3,333,333 Credit: Finished Goods $3,333,333 Credit: Cost of Goods Sold $3,333,334
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