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Lotus Companys actual overhead is greater than the applied overhead. This difference is deemed immaterial. The company records this by debiting Overhead account and crediting

Lotus Companys actual overhead is greater than the applied overhead. This difference is deemed immaterial. The company records this by debiting Overhead account and crediting Cost of Goods Sold account. Which of the following is true of Lotus Company? The company has correctly recorded the difference. The companys assets are overstated. The company should have credited Work in Process account for the difference. The companys Cost of Goods Sold account is understated.

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