Please provide instructions on solving this. The answer was $810,000 but I do not know how to get it.
Hardin company’s manufacturing overhead account showed a $20,000 underapplied overhead balance on December 31. Other data as of December 31 appear below:
Cost of goods sold………………………………………………………………………..$800,000
Overhead applied during the year included in cost of goods sold………..$200,000
Overhead applied during the year in the ending balances of:
….Work in process inventory…………………………………………………………..$80,000
….Finished goods inventory…………………………………………………………….$120,000
If the company allocates the underapplied overhead among cost of goods sold and the appropriate inventory accounts based on the amount of overhead applied during the year in the accounts, cost of goods sold after allocation will be: