Which of the following is false about actual overhead while using normal costing?
A) Actual overhead is recorded to the overhead control account during the period.
B) If the actual overhead is greater than the applied overhead then the overhead is underapplied
C) Overhead variance is the difference between actual overhead and applied overhead.
D) It is divided into many smaller accounts such as indirect labor, supplies, etc.
E) None of these.

Question

Quizplus · Accepted Answer

Actual overhead is not divided into many smaller accounts, rather it is recorded to a single overhead control account. The smaller accounts such as indirect labor, supplies, etc. are used to apply overhead to the products using predetermined rates.

Which of the Following Is False About Actual Overhead While