Premium Woods manufactures jewelry boxes. The primary materials (wood, brass, and glass) and direct labor are assigned directly to the products. Manufacturing overhead costs are allocated based on machine hours. Data for 2016 follow:

Requirements
1. Compute the predetermined overhead allocation rate.
2. Post actual and allocated manufacturing overhead to the Manufacturing Overhead T-account.
3. Prepare the journal entry to adjust for underallocated or overallocated overhead.
4. The predetermined overhead allocation rate usually turns out to be inaccurate. Why don€™t accountants just use the actual manufacturing overhead rate?

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Estimated 26,500 hours 12,000 43,000 23,000 49,000 35,000 85,000 44,000 Actual Machine hours Maintenance labor (repairs to equipment) Plant supervisor's salary Screws, nails, and glue Plant utilities Freight out Depreciation on plant and equipment Advertising expense 32,600 hours S 29,500 49,000 48,000 90,850 47,500 84,000 54,000