Antique Inc. employs a normal job order costing system, using direct labor cost to apply manufacturing overhead. The following information is available for 2012 :
There were no beginning inventories at the beginning of the year.
On January 1, 2012 , the company estimated that 2012 manufacturing overhead cost at $1,500,000 and 2012 direct labor cost at $500,000.
Actual 2012 Manufacturing Overhead Cost totaled $1,780,952.
At December 31, 2012 , prior to any adjusting entries , the following information was reported :
Direct Materials In : Work In Process : $70,000 Finished Goods Inventory : $56,000 Cost Of Goods Sold : $294,000 Period Total : $420,000
Direct Labor Cost In : Work In Process : $50,000 Finished Goods Inventory : $80,000 Cost Of Goods Sold : $420,000
Period Total : $550,000
Manufacturing Overhead Cost In : Work In Process ? Finished Goods ? Cost of Goods Sold ?
Antique Inc prorates any over or under applied overhead to work in process, finished goods, and cost of goods sold based on manufacturing overhead posted to each of these accounts.
Question: What will be the amount of cost of goods sold on the final income statement (after pro-ration)?
A) 1,874,000 B) 1,924,000 C) 2,024,000 D) 2,074,000 E) None