What is under-applied overhead and how is an immaterial amount closed at fiscal year end?

A.Underapplied overhead is when actual applied overhead costs (debits) are lower than overhead applied to jobs (credits). The immaterial amount is closed to cost of goods sold.

B.Underapplied overhead occurs when actual applied overhead costs (debits) are higher than overhead applied to jobs (credits). The immaterial amount is disregarded, as it is immaterial.

C.Underapplied overhead occurs when actual applied overhead costs (debits) are lower than overhead applied to jobs (credits). The immaterial amount is disregarded, as it is immaterial.

D.Underapplied overhead occurs when actual applied overhead costs (debits) are higher than overhead applied to jobs (credits). The immaterial amount is closed to cost of goods sold.