Week 2 Discussion - Describe the overhead and overhead application process

Week 2 Discussion

Discussion Question Two:

Overhead application to costs is a critical issue for the costing of your products. We are studying several ways to handle this situation.

• Describe the overhead and overhead application process.
• What would cause overhead to be overapplied or underapplied?
• Discuss the results of your decision making and the financial statements for each of those two situations.
• Describe how the over or under application of overhead should be corrected in the accounting records.