Question

At the end of the period, the balance left in the factory overhead account is equal to the

Answer 1

Answer:

d.total factory overhead cost variance.

Explanation:

In manufacturing accounting, at the beginning of the period, manufacturing overheads (i.e. costs other than Direct Material and Direct Labor) has been applied to Work-in-process using a predetermined overhead rate. At the end of the period, if the manufacturing overhead account shows a debit balance, that signifies that overhead has been under-applied (i.e. the manufacturing overhead cost applied to work in process is less than the actual manufacturing overhead cost for the period), and contrariwise if the manufacturing overhead account shows a credit balance, it means the overhead is over-applied (i.e. the manufacturing overhead cost applied to work in process is more than the actual manufacturing overhead cost for the period). In any case this balance warrants an adjustment to close out the books, by transferring it to the cost of goods sold account.