Castagnola Inc. has provided the following data for the month of January. There were no beginning inventories; consequently, the direct materials, direct labor, and manufacturing overhead applied listed below are all for the current month.

	Work In Process			Finished Goods			Cost of Goods Sold			Total
Direct materials	$	880		$	5,500		$	23,100		$	29,480
Direct labor		4,100			17,600			73,920			95,620
Manufacturing overhead applied		2,460			7,380			31,160			41,000
Total	$	7,440		$	30,480		$	128,180		$	166,100

Manufacturing overhead for the month was overapplied by $1,000.

The company allocates any underapplied or overapplied manufacturing 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 journal entry to record the allocation of any underapplied or overapplied manufacturing overhead for January would include the following:

Multiple Choice

• credit to Cost of Goods Sold of $760

• debit to Cost of Goods Sold of $128,180

• credit to Cost of Goods Sold of $128,180

• debit to Cost of Goods Sold of $760