MC 27 What is the purpose of the journal entry to dispose of underapplied or overapplied overhead?
A. To allocate the difference between actual overhead and applied overhead to specific products.
B. To adjust the balance in the Manufacturing Overhead account to reflect the actual amount of overhead costs incurred.
C. To close the Manufacturing Overhead account at the end of the period.
D. To allocate the difference between actual overhead and applied overhead to the Cost of Goods Sold account.
Answer:B
MC 27 What is the purpose of the journal entry to dispose of underapplied or overapplied overhead?
A. To allocate the difference between actual overhead and applied overhead to specific products. B. To adjust the balance in the Manufacturing Overhead account to reflect the actual amount of overhead costs incurred. C. To close the Manufacturing Overhead account at the end of the period. D. To allocate the difference between actual overhead and applied overhead to the Cost of Goods Sold account.
Explanation: The journal entry to dispose of underapplied or overapplied overhead is used to adjust the balance in the Manufacturing Overhead account to reflect the actual amount of overhead costs incurred.