Question

Echher Corporation uses a job-order costing system and applies overhead to jobs using a predetermined overhead rate. During the year the company's Finished Goods inventory account was debited for $218,000 and credited for $218,500. The ending balance in the Finished Goods inventory account was $13,000. At the end of the year, manufacturing overhead was overapplied by $36,700.
If the applied manufacturing overhead was $223,900, the actual manufacturing overhead cost for the year was:

$200,700

$260,600

$200,200

$187,200

Answer 1

Answer:

$187,200

Explanation:

Given that,

Company's Finished Goods inventory Debited = $218,000

Company's Finished Goods inventory credited = $218,000

Ending balance in the Finished Goods inventory = $13,000

Manufacturing overhead was overapplied by $36,700.

Applied manufacturing overhead = $223,900

Actual manufacturing overhead cost for the year:

= Manufacturing overhead applied - Manufacturing overhead overapplied

= $223,900 - $36,700

= $187,200