Question

The Cherokee Company uses a predetermined overhead rate. The following accounts have these unadjusted balances: Raw Materials $20,000 Work in Process $40,000 Finished Goods $10,000 Cost of Goods Sold $50,000 If overhead is underapplied by $12,000 and considered immaterial, the journal entry would be
a. Manufacturing Overhead$12,000 Cost of Goods Sold$12,000
b. Manufacturing Overhead$12,000 Raw Materials$2,000 Work in Process$4,000 Finished Goods$1,000 Cost of Goods Sold$5,000
c. Raw Materials$2,000 Work in Process$4,000 Finished Goods$1,000 Cost of Goods Sold$5,000 Manufacturing Overhead$12,000
d. Manufacturing Overhead$12,000 Work in Process$4,800 Finished Goods$1,200 Cost of Goods Sold$6,000
e. Cost of Goods Sold$12,000 Manufacturing Overhead$12,000

Answer 1

Answer

option b.

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Explanation  

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