Plano Products, Inc., had a remaining credit balance of $10,000 in its under- and overapplied factory overhead account at year- end. It also had year-end balances in the following accounts:
WorkinProcess ................................................... $ 25,000 FinishedGoods ................................................... 15,000 CostofGoodsSold ................................................ 85,000 Total ............................................................. $125,000
Required:
1. Prepare the closing entry for the $10,000 of overapplied over- head, assuming that the balance is not considered to be material.
2. Prepare the closing entry for the $10,000 of overapplied over- head, assuming that the balance is considered to be material.