Question

Tammy’s Cosmetics uses a normal costing system and has the following balances at the end of its first year’s operations.
WIP inventory ....... $231,000
Finished-goods inventory ... 198,000
Cost of goods sold ..... 396,000
Actual factory overhead .... 416,000
Factory overhead applied ... 456,000
Compute cost of goods sold for two different ways to dispose of the year-end overhead balances.
By how much would gross profit differ?



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  • CreatedNovember 19, 2014
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