When manufacturing overhead is applied to production in a job-order costing system,the accounting records would reflect an increase in which of the following accounts?
A) Work in Process Inventory
B) Cost of Goods Sold
C) Finished Goods Inventory
D) Raw Materials Inventory

Question

Quizplus · Accepted Answer

Manufacturing overhead is applied to production in order to allocate indirect costs to the specific job or product being produced. This allocation increases the balance in the Work in Process Inventory account, which represents the value of all partially completed jobs in a job-order costing system. The other answer choices are not affected by the application of manufacturing overhead.

When Manufacturing Overhead Is Applied to Production in a Job-Order