A debit balance in the manufacturing overhead account at the end of the period indicates that:
A) manufacturing overhead is overapplied.
B) manufacturing overhead is underapplied.
C) manufacturing overhead has been accurately applied.
D)None of the above.

Question

Quizplus · Accepted Answer

A debit balance in the manufacturing overhead account at the end of the period indicates that more manufacturing overhead has been charged to production than has actually been incurred. This means that manufacturing overhead is underapplied, which requires an adjustment to be made to ensure accurate allocation of overhead costs to products.

A Debit Balance in the Manufacturing Overhead Account at the End