Multiple Choice
At the current year-end, Simply Company found that its overhead was underapplied by $2,500, and this amount was not considered material. Based on this information, Simply should:
A) Close the $2,500 to Finished Goods Inventory.
B) Do nothing about the $2,500, since it is not material, and it is likely that overhead will be overapplied by the same amount next year.
C) Carry the $2,500 to the income statement as "Other Expense".
D) Carry the $2,500 to the next period.
E) Close the $2,500 to Cost of Goods Sold.
Correct Answer:
Verified
Correct Answer:
Verified
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