Which method for dealing with under/over allocated overhead provides the most accurate individual job cost records?

Question

Quizplus · Accepted Answer

The adjusted allocation-rate approach provides the most accurate individual job cost records as it recalculates the predetermined overhead rate for each department based on actual overhead costs incurred during the period. This ensures that the overhead costs allocated to each job are more accurate and reflective of actual usage. The proration approach also tries to allocate overhead costs based on actual usage, but it only takes into account under/over allocated overhead at the end of the period and applies it proportionately to all jobs, which may not be as accurate. The immediate write-off to cost of goods sold approach would not provide individual job cost records as the overhead costs would not be assigned to specific jobs.

Which Method for Dealing with Under/over Allocated Overhead Provides the Most