If the overhead control account has a credit balance at the end of the period, then overhead is _____.
A)overapplied and the difference should be credited to the proper accounts
B)overapplied and the difference should be debited to the proper accounts
C)underapplied and the difference should be debited to the proper accounts
D)underapplied and the difference should be credited to the proper

Question

Quizplus · Accepted Answer

When overhead has a credit balance, it means that the actual overhead costs were less than the overhead costs applied to products, indicating that overhead is overapplied. The difference should be credited to the proper accounts to adjust the cost of goods sold or inventory accounts accordingly.

If the Overhead Control Account Has a Credit Balance at the End