When underapplied or overapplied overhead is allocated among the three accounts work in process, finished goods and cost of goods sold, this process is called:
A) proration.
B) just-in-time costing.
C) zero-based costing.
D) overhead application.

Question

Quizplus · Accepted Answer

Proration involves allocating underapplied or overapplied overhead among work in process, finished goods, and cost of goods sold based on their relative balances or some other systematic and rational basis.

When Underapplied or Overapplied Overhead Is Allocated Among the Three