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ABC Company listed the following data for 20XX:

Budgeted factory overhead $ 1,044,000

Budgeted direct labor hours 72,000

Budgeted machine hours 24,000

Actual factory overhead 1,037,400

Actual direct labor hours 72,600

Actual machine hours 23,600

Assuming ABC Company applied overhead based on direct labor hours, the journal entry to adjust overapplied / underapplied overhead would include a credit to:

	a.	work in process inventory
	b.	cost of goods sold
	c.	finished goods inventory
	d.	factory overhead control Assuming ABC Company applied overhead based on machine hours, the journal entry to adjust overapplied / underapplied overhead would include a debit to: a. work in process inventory b. cost of goods sold c. finished goods inventory d. factory overhead control Assuming ABC Company applied overhead based on direct labor hours, the journal entry's effect on income would: a. reduce income to the correct amount b. increase income to the correct amount c. have no effect on income d. understate revenue Assuming ABC Company applied overhead based on machine hours, the journal entry would: a. reduce income to the correct amount b. increase income to the correct amount c. have no effect on income d. understate revenue

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