Under-applied overhead at the end of a month:
A) Results when actual overhead costs are less than amounts applied to work in process.
B) Indicates a poorly designed cost accounting system.
C) Is represented by a debit balance remaining in the Manufacturing Overhead account.
D) Is represented by a credit balance remaining in the Manufacturing Overhead account.

Question

Quizplus · Accepted Answer

Under-applied overhead occurs when the actual overhead costs are greater than the overhead costs applied to the work in process. This results in a debit balance remaining in the Manufacturing Overhead account.

Under-Applied Overhead at the End of a Month