Gest Inc. has provided the following data for the month of November. The balance in the Finished Goods inventory account at the beginning of the month was $59,000 and at the end of the month was $54,000. The cost of goods manufactured for the month was $271,200. The actual manufacturing overhead cost incurred was $88,800 and the manufacturing overhead cost applied to jobs was $84,000. The adjusted cost of goods sold that would appear on the income statement for November is: $276,000 $266,400 $281,000 $271,200
Answer:.
The adjusted cost of goods sold that would appear on the income statement for November is=$ 281,000
Working notes for the above answer is as under
We have been provided with the information as follow
| Particular | Amount t in $ |
| Finished Goods inventory account at the beginning of the month |
59000 |
| Finished Goods inventory account at the end of the month |
54000 |
| ost of goods manufactured for the month was | 271200 |
| The actual manufacturing overhead cost incurred | 88800 |
| manufacturing overhead cost applied to jobs was | 84000 |
The adjusted cost of goods sold that would appear on the income statement for November is calculated as follow
Manufacturing overhead under applied (over applied)
= Actual manufacturing overhead incurred – Manufacturing overhead applied
= $88800 – $84,000
= $4,800
underapplied Adjusted cost of goods sold =4800
Beginning finished goods inventory + Cost of goodsmanufactured – Ending finished goods inventory + Manufacturing overhead underapplied
= $59,000 + $274200 – $54,000 + $4,800
= $281,000
