Match each item with the correct statement below.
-The difference between actual overhead and applied overhead
A)predetermined overhead rate
B)plantwide overhead rate
C)departmental overhead rate
D)overhead variance
E)overapplied overhead
F)underapplied overhead
G)applied overhead
H)normal cost of goods sold

Question

Quizplus · Accepted Answer

Overhead variance is the difference between actual overhead and applied overhead.

Answer: A
 Predetermined overhead rate is used to apply overhead to products and is calculated by dividing estimated total manufacturing overhead costs by estimated total allocation base.

Answer: B
 Plantwide overhead rate is calculated by dividing estimated total manufacturing overhead costs by estimated total allocation base across the entire plant.

Answer: C
 Departmental overhead rate is calculated separately for each department by dividing estimated total manufacturing overhead costs by estimated total allocation base for each department.

Answer: E
 Overapplied overhead occurs when applied overhead is greater than actual overhead.

Answer: F
 Underapplied overhead occurs when applied overhead is less than actual overhead.

Answer: G
 Applied overhead is the amount of manufacturing overhead assigned to products using the predetermined overhead rate.

Answer: H
 Normal cost of goods sold is the cost of goods sold, excluding any underapplied or overapplied overhead.

Match Each Item with the Correct Statement Below