Reference no: EM132581111

A company has provided the following data for the month of May:

Inventories:

                                      Beginning                     Ending

Work in process             $30,000                  $25,000

Finished goods              $59,000                   $63,000

Additional information:

Direct materials $70,000

Direct labor cost $100,000

Manufacturing overhead cost incurred $76,000

Manufacturing overhead cost applied to Work in Process $74,000

Any underapplied or overapplied manufacturing overhead is closed out to cost of goods sold.

Question 1: The adjusted cost of goods sold (that is, cost of goods sold adjusted for underapplied or overapplied overhead) for May is:

Multiple Choice

Option 1: $247,000

Option 2: $245,000

Option 3: $249,000

Option 4: $244,000