If Manufacturing Overhead Has Been Overallocated During the Period, and Most

question 289

Multiple Choice

If manufacturing overhead has been overallocated during the period, and most of the jobs produced have been sold, then

• A)Cost of Goods Sold on the income statement should be increased.
• B)Cost of Goods Sold on the income statement should be decreased.
• C)finished goods inventory should be increased.
• D)work in process inventory should be decreased.

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Definitions:

Risk Averse

Characteristic of individuals or entities that prefer to avoid risks and opt for safer options when making decisions.

Loss Averse

A cognitive bias that describes why for individuals the pain of losing is psychologically about twice as powerful as the pleasure of gaining.

Benefits

The positive effects or advantages derived from a particular action, decision, or situation.

Status Quo

The existing state of affairs or the current condition, typically used in the context of social, political, or economic issues.