Castagnola Inc. has provided the following data for the month of January. There were no beginning inventories; consequently, the direct materials, direct labor, and manufacturing overhead applied listed below are all for the current month.  Work In ProcessFinished GoodsCost of Goods SoldTotalDirect materials$880 $5,500 $23,100 $29,480 Direct labor 4,100  17,600  73,920  95,620 Manufacturing overhead applied 2,460  7,380  31,160  41,000 Total$7,440 $30,480 $128,180 $166,100  Manufacturing overhead for the month was overapplied by $1,000. The company allocates any underapplied or overapplied manufacturing overhead among work in process, finished goods, and cost of goods sold at the end of the month on the basis of the overhead applied during the month in those

accounts. The journal entry to record the allocation of any underapplied or overapplied manufacturing overhead for January would include the following:

A. credit to Cost of Goods Sold of $128,180
B. debit to Cost of Goods Sold of $128,180
C. debit to Cost of Goods Sold of $760
D. credit to Cost of Goods Sold of $760


Answer: D

Business

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