When underapplied or overapplied manufacturing overhead is prorated, to which of the following accounts can amounts be assigned?

A) Direct materials, manufacturing overhead and direct labour
B) Cost of goods sold, work in process and finished goods
C) Direct materials, finished goods and cost of goods sold
D) Direct materials, work in process inventory and finished goods inventory

Underapplied Manufacturing Overhead

Occurs when the allocated manufacturing overhead costs are less than the actual overhead costs incurred, resulting in a cost variance.

Prorated

Dividing or allocating amounts proportionally based on specific metrics or criteria, often used in billing and cost sharing.

Overapplied Manufacturing Overhead

A situation where the allocated manufacturing overhead cost is greater than the actual overhead incurred.