The estimates used to calculate the predetermined overhead rate will virtually always:
A. result in overapplied overhead that is closed to Cost of Goods Sold if it is immaterial in amount.
B. prove to be correct.
C. result in a year-end balance of zero in the Manufacturing Overhead account.
D. result in underapplied overhead that is closed to Cost of Goods Sold if it is immaterial in amount.
E. result in either underapplied or overapplied overhead that is closed to Cost of Goods Sold if it is immaterial in amount.
Answer: E
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