Discussion Essay

Overhead application to costs is a critical issue for the costing of your products. We are studying several ways to handle this situation. 

Describe overhead and the overhead application process.
What would cause an overhead to be overapplied, or underapplied.
Discuss the results to your decision making and the financial statements for each of those two situations.
Describe how the over or under application of overhead should be corrected in the accounting records.