Applying overhead to products means:

Question

Quizplus · Accepted Answer

Applying overhead to products means assigning the overhead costs on a basis that closely relates it to the work performed. This ensures that the cost of the overhead is distributed fairly across the products based on how much of the overhead cost is consumed by their production. Passing on the overhead costs to customers in the price charged (A) is ultimately what happens, but it is not the method of assigning the overhead cost to products. Directly tracing the overhead to products (C) is possible if the overhead is exclusively used in the production of one product, but in most cases, the overhead is shared among various products. Calculating the total overhead cost (D) is necessary before assigning it to products, but it is not the method of assigning it to products.

Applying Overhead to Products Means