Filippucci Company used a budgeted indirect-cost rate for its manufacturing operations, the amount allocated ($200,000) is different from the actual amount incurred ($225,000).

-Under the writeoff approach, the difference between Manufacturing Overhead Control and Manufacturing Overhead Allocated is adjusted in the ________.
A) Cost of Goods Sold account
B) Work-in Process account
C) Manufacturing Overhead account
D) Miscellaneous Expenses account

Question

Filippucci Company used a budgeted indirect-cost rate for its manufacturing operations, the amount allocated ($200,000) is different from the actual amount incurred ($225,000).
 
-Under the writeoff approach, the difference between Manufacturing Overhead Control and Manufacturing Overhead Allocated is adjusted in the ________.
A) Cost of Goods Sold account 
B) Work-in Process account 
C) Manufacturing Overhead account 
D) Miscellaneous Expenses account

Quizplus · Accepted Answer

Under the write-off approach, the difference between Manufacturing Overhead Control and Manufacturing Overhead Allocated is adjusted in the Cost of Goods Sold account. This method directly affects the income statement by adjusting the cost of goods sold to reflect the actual overhead costs incurred.

Filippucci Company Used a Budgeted Indirect-Cost Rate for Its Manufacturing