Emigh Corporation's cost of goods manufactured for the just completed month was $146,000 and its overhead was overapplied by $5,000. The beginning finished goods inventory was $35,000 and the ending finished goods inventory was $37,000. The company closes out any underapplied or overapplied manufacturing overhead to cost of goods sold. How much was the adjusted cost of goods sold on the Schedule of Cost of Goods Sold?

(A) $144,000

(B) $146,000

(C) $181,000

(D) $139,000

Question

Gemma Petty

Business

2 February, 05:22

Emigh Corporation's cost of goods manufactured for the just completed month was $146,000 and its overhead was overapplied by $5,000. The beginning finished goods inventory was $35,000 and the ending finished goods inventory was $37,000. The company closes out any underapplied or overapplied manufacturing overhead to cost of goods sold. How much was the adjusted cost of goods sold on the Schedule of Cost of Goods Sold?

(A) $144,000

(B) $146,000

(C) $181,000

(D) $139,000

+3

Answers (1)

Know the Answer?

Jorge Baird · Answer 1

(D) $139,000

Explanation:

The computation of the adjusted cost of goods sold is shown below:

= Beginning balance of finished goods inventory + cost of goods manufactured - ending balance of finished goods inventory - over-applied overhead

= $35,000 + $146,000 - $37,000 - $5,000

= $139,000

The Beginning balance of finished goods inventory + cost of goods manufactured is called cost of goods available for sale.