Which one of the following is true concerning immaterial under-applied overhead at year end?

Question

Quizplus · Accepted Answer

When overhead is under-applied, it means that the actual manufacturing overhead costs were higher than what was applied to the products. Therefore, the Cost of Goods Sold (COGS) is too low and needs to be adjusted upwards. This adjustment is made by debiting COGS, which increases the expense to reflect the actual costs incurred.

Which One of the Following Is True Concerning Immaterial Under-Applied