If overhead was overapplied during the accounting period by an insignificant amount,the The entry to close the Mdispose of overapplied manufacturing Ooverhead account will include a:
A) Debit to cost of goods soldCost of Goods Sold and a credit to manufacturing overheadManufacturing Overhead.
B) Debit to cost of goods soldCost of Goods Sold and a credit to finished goodsFinished Goods Inventory.
C) Debit to manufacturing overheadManufacturing Overhead and a credit to cost of goods soldCost of Goods Sold.
D) Debit to finished goodsFinished Goods Inventory and a credit to manufacturing overheadManufacturing Overhead.

Question

Quizplus · Accepted Answer

When overhead is overapplied,actual overhead was lower than applied overhead (which is the amount of overhead that is included in work in process).At a result,the debits in the Manufacturing Overhead account (for the actual overhead costs)would be less than the credits in the account (for the amount applied)and,as a result,the Manufacturing Overhead account would have a credit balance.The entry to close the account will debit the Manufacturing Overhead account (to offset the existing credit balance)and credit (or decrease)the balance in the Cost of Goods Sold account.

If Overhead Was Overapplied During the Accounting Period by an Insignificant