If the amount of over- or under-applied overhead is material, the amount should be closed to Work in Process.

Name: If the amount of over- or under-applied overhead is material, the amount should be closed to Work in Process.
Brand: Quizplus
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Question

Quizplus · Accepted Answer

If the amount of over- or under-applied overhead is material, it should be allocated between Work in Process, Finished Goods, and Cost of Goods Sold based on their relative balances, not closed solely to Work in Process.

If the Amount of Over- or Under-Applied Overhead Is Material