Overapplied Manufacturing Overhead Means That

question 148

Multiple Choice

Overapplied manufacturing overhead means that:

• A)the applied manufacturing overhead cost was less than the actual manufacturing overhead cost.
• B)the applied manufacturing overhead cost was greater than the actual manufacturing overhead cost.
• C)the estimated manufacturing overhead cost was less than the actual manufacturing overhead cost.
• D)the estimated manufacturing overhead cost was less than the applied manufacturing overhead cost.

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Definitions:

Book Value

The value of an asset according to its balance sheet account balance, taking into account the cost of the asset minus depreciation.

Depreciation

is an accounting method that allocates the cost of a tangible asset over its useful life, reflecting the asset's consumption, wear and tear, or obsolescence.

Double-Declining-Balance Rate

A method of accelerated depreciation that doubles the rate at which an asset's value is reduced, resulting in higher depreciation expenses in the initial years of the asset's life.

Straight-Line Rate

The method of calculating equal depreciation expenses for an asset over its useful life.