Reference no: EM132658384

Problem 1: The company incurred $156,938 in manufacturing overhead and applied $160,742. The company uses the most common and simple method of handling differences between actual and applied overhead. What should be done with the difference of $3,804?

a. Add the difference to cost of goods manufactured.

b. Subtract the difference from cost of goods manufactured.

c. Add the difference to cost of goods sold.

d. Subtract the difference from cost of goods sold.

e. Add the difference to ending finished goods inventory.

f. Subtract the difference from ending finished goods inventory.

g. Add the difference to ending work-in-process inventory.

h. Subtract the difference from ending work-in-process inventory.