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What happens to the balance in the factory overhead account at the end of the year?

April 26, 2017account Balance factory happens overhead year

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What happens to the balance in the factory overhead account at the end of the year?

1 Answer

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The factory overhead balance at the end of the year applies to current operations. It should not be carried into the next fiscal year. The overapplied or underapplied balance should be transferred to the cost of goods sold account.