Not able to set values on Material UI TextField Select component - reactjs

Question

I am new to React.
I want to build a Form that has a Text field and a dropdown with 2 selections.
The form renders but I am unable to select any values from the dropdown. The handleChange function doesnt run.
const Category = () => {
const theme = useTheme();
const colors = tokens(theme.palette.mode);
const [formValues, setformValues] = useState({
categoryName: "Test",
categoryType: "Expense",
})
const categories = [
{
value: 'Income',
label: 'Income',
},
{
value: 'Expense',
label: 'Expense',
},
];
const handleFormSubmit = (values) => {
console.log(`Submitting : ${JSON.stringify(values)}`);
};
const isNonMobile = useMediaQuery("(min-width:600px)");
const handleCategoryTextChange = (event) => {
console.log(`Category Text Change ${event}`);
setformValues({
...formValues,
categoryName: event.target.value,
})
}
const handleCategoryChange = (event) => {
console.log(`Category Change Event ${event.target.value}`);
setformValues({
...formValues,
categoryType: event.target.value
})
};
return (
<Box>
<Box m="20px">
<Header title="CREATE CATEGORY" subtitle="Create a New Category" />
<form onSubmit={handleFormSubmit}>
<Box
display="grid"
gap="30px"
gridTemplateColumns="repeat(4, minmax(0, 1fr))"
sx={{
"& > div": { gridColumn: isNonMobile ? undefined : "span 4" },
}}
>
<TextField
fullWidth
variant="filled"
type="text"
label="Category Name"
onChange={handleCategoryTextChange}
value={formValues.categoryName}
name="categoryName"
sx={{ gridColumn: "span 2" }}
/>
<TextField
fullWidth
variant="filled"
label="Category Type"
onChange={handleCategoryChange}
value={formValues.categoryType}
name="categoryType"
sx={{ gridColumn: "span 2" }}
select
>
{categories.map((option) => (
<MenuItem key = {option.value} value={option.value}>
{option.label}
</MenuItem>
))}
</TextField>
</Box>
</form>
</Box>
</Box>
);
};
I am expecting the dropdown to be selectable and the handleChange events to be triggered.
Once this is working, I would submit the form values to an API endpoint