At year-end,Factory Overhead account is:

A) Overapplied by $10,000.
B) Overapplied by $170,000.
C) Underapplied by $10,000.
D) Overapplied by $20,000.
E) Neither overapplied nor underapplied.

Factory Overhead

Factory overhead encompasses all the indirect costs involved in manufacturing a product, which may include utilities, maintenance, and management salaries, excluding direct materials and labor costs.

Direct Labor Costs

The total cost of all the labor force that is directly involved in the production process, measured by wages, salaries, and benefits of those who actually work on the product directly.

Overapplied

A situation where the overhead allocated to goods produced exceeds the actual overhead incurred.