Which of the Following Statements About Under- or Overapplied Manufacturing

question 53

Multiple Choice

Which of the following statements about under- or overapplied manufacturing overhead is correct?

• A)After the adjustment to transfer over- or underapplied overhead to Cost of Goods Sold Manufacturing Overhead will have a zero balance.
• B)When Manufacturing Overhead has a negative balance overhead is said to be under-applied.
• C)At the end of the year under- or overapplied overhead is not eliminated by adjusment.
• D)When annual financial statements are prepared overapplied overhead is reported in current liabilities.

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Definitions:

Inappropriate Activity

Actions or behaviors that are not suitable or proper in a given context or situation.

Intelligence

The capacity to understand the world, think with rationality, and use resources effectively when faced with challenges.

Rationality

The quality of being based on or in accordance with reason or logic.

Challenges

Difficult situations that require a person to utilize skills and resources in order to overcome them.