overapplied overhead

Definitions

1. Excess of overhead applied to work-in-process inventory over the amount of overhead actually incurred. This amount (called favorable variance) is added to the budgeted profit in the end-of-accounting-period financial statements. Also called overabsorbed overhead. See also underapplied overhead.

2. A situation in which the overhead applied to a work in progress (WIP) product is more than the overhead that the WIP actually incurs. This results in the manufacturing overhead having a credit balance. Overapplied overhead is reported on the balance sheet and is reported as unearned revenue. At the end of the year, overapplied overhead is balanced by creating a credit to Cost of Goods Sold. Opposite of underapplied overhead.

单词	overapplied overhead
释义	overapplied overhead Definitions 1. Excess of overhead applied to work-in-process inventory over the amount of overhead actually incurred. This amount (called favorable variance) is added to the budgeted profit in the end-of-accounting-period financial statements. Also called overabsorbed overhead. See also underapplied overhead. 2. A situation in which the overhead applied to a work in progress (WIP) product is more than the overhead that the WIP actually incurs. This results in the manufacturing overhead having a credit balance. Overapplied overhead is reported on the balance sheet and is reported as unearned revenue. At the end of the year, overapplied overhead is balanced by creating a credit to Cost of Goods Sold. Opposite of underapplied overhead.
随便看	operating budget operating capital operating cash flow operating cash flow ratio operating cash flow to sales ratio operating characteristics (OC) curve operating company operating cost operating cycle operating effectiveness operating efficiency operating environment operating expenditures operating expense ratio operating expenses operating expenses budget operating expenses to gross income ratio operating expenses to gross margin ratio operating expenses to sales ratio operating exposure operating funds operating income operating interest operating lease operating leverage