The excess of actual overhead costs over the applied overhead costs is called ________.
A)overapplied overhead
B)underapplied overhead
C)underbudgeted overhead
D)overestimated overhead

Question

Quizplus · Accepted Answer

Underapplied overhead occurs when the actual overhead costs are greater than the applied overhead costs. This means that not enough overhead was allocated to products or services, resulting in a lower gross margin and potentially inaccurate pricing decisions.

The Excess of Actual Overhead Costs Over the Applied Overhead