These types of expenses are composed of both fixed and variable components. They are fixed up to a certain production level, after which they become variable. It’s easy to separate the two, as fixed costs occur on a regular basis while variable ones change as a result of production output and the overall volume of Read more about Fixed vs Variable Cost: Whats the Difference?[…]

This means that a company comes in under budget and achieves a lower amount of overhead costs during the accounting period. A journal entry must be made at the end of the period to reconcile the difference between the estimated amount and the actual overhead costs. In this case we would, debit the factory overhead account and credit Read more about Solved Overapplied overhead occurs when the actual overhead[…]