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Worley Company has under applied overhead of P45, 000 for the year. Before disposition of the underapplied overhead, selected year-end balances from Worley's accounting records were
Sales P1,200,000
Cost of Goods Sold P720,000
Direct Materials Inventory P36,000
Work in Process Inventory P54,000
Finished Goods Inventory P90,000
Problem 1: Under Worley's cost accounting system, over or under applied overhead is allocated to appropriate inventories and cost of goods sold based on year-end balances in it's year end income statement. Worley should report cost of goods sold of
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