Chan Company uses a job-order costing system. The journal entry to the cost of goods sold (COGS) account to close out the balance in the manufacturing overhead (MOH) account was a debit of $7,460. Which of the following statements is correct?

a.The company under applied manufacturing overhead.

b.The net income for the period will decrease following the adjustment.

c.The cost of goods manufactured for the period is overstated.

d.There is a debit balance in the manufacturing overhead account.