When monthly financial statements are prepared, where will you expect to find under-applied overhead if immaterial?

Question

Quizplus · Accepted Answer

Under-applied overhead is typically included in the Cost of Goods Sold calculation on the income statement. However, if the amount is immaterial, it may not be separately listed and will simply be included as part of the overall Cost of Goods Sold. It would not be classified as a current liability or prepaid expense, and it would not be a component of the Work in Process Inventory account.

When Monthly Financial Statements Are Prepared, Where Will You Expect