To calculate under or over applied overhead compare the amount of overhead allocated to the actual overhead cost.

Name: To calculate under or over applied overhead compare the amount of overhead allocated to the actual overhead cost.
Brand: Quizplus
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Question

Quizplus · Accepted Answer

To determine if overhead is under or over-applied, you compare the allocated (or applied) overhead based on predetermined rates to the actual overhead costs incurred. If the allocated amount is less than the actual cost, it's under-applied; if more, it's over-applied.

To Calculate Under or Over Applied Overhead Compare the Amount