Accountants use actual overhead rates to apply overhead to jobs as they are completed.

Question

Quizplus · Accepted Answer

Accountants use predetermined overhead rates to apply overhead to jobs as they are completed. The predetermined overhead rate is calculated based on estimates of expected overhead costs and expected activity levels for the period. Actual overhead rates are only used for analysis and adjusting the predetermined rate for future periods.

Accountants Use Actual Overhead Rates to Apply Overhead to Jobs