Tom Brooks, production manager for Clarion Manufacturing, was told that product overhead Obj. 2 costs were too high, and the amount of overhead applied to inventory is less than the actual costs incurred over the last few months. Tom responds that he doesn't understand what "applied" means when dealing with inventory costs. Explain to Tom what is meant by the statement overhead is applied to units of product. Must the actual amount of overhead costs incurred always equal the amount of overhead applied to inventory?