Manufacturing overhead has been underallocated during the period in an amount not considered to be material and most of the jobs produced have been sold The adjustment to close the underallocated overhead will result in a/an decrease cost of goods sold increase cost of goods sold. allocation to work in process and finished goods inventories. increase in work in process inventory QUESTION 24 The primary purpose of classifying costs as variable or fixed is it is required by US Generally Accepted Accounting Principles to allow management to better assess performance given a level of activity that differed from budget to allow management to determine the amount of cost of goods sold on the income statement to allow management to prepare the income statement for financial reporting