During 2013, a company incurs $500 000 of manufacturing overhead costs and allocates out $506 000 of manufacturing overhead costs. Overhead costs have been underallocated.

Name: During 2013, a company incurs $500 000 of manufacturing overhead costs and allocates out $506 000 of manufacturing overhead costs. Overhead costs have been underallocated.
Brand: Quizplus
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Question

Quizplus · Accepted Answer

Overhead costs have been overallocated because the company allocated more ($506,000) than it incurred ($500,000).

During 2013, a Company Incurs $500 000 of Manufacturing Overhead