1 Problem 3-12 (Static) Predetermined Overhead Rate; Disposing of Underapplied or Overapplied Overhead (LO3-4] Do turadis Company makes furniture using the latest automated technology. The company uses a job order costing system and applies manufacturing overhead cost to products on the basis of machine hours. The predetermined overhead rate was based on a cost formula that estantes 5900,000 of total manufacturing overtiead for an estimated activity level of 75,000 machine hours During the year, a large quantity of furniture on the market resulted in cutting back production and a buildup of furniture in the company's warehouse. The company's cost records revealed the following actual cost and operating data for the year Machines 60,000 acturing what cont Inverter a year waterial 330.00 work in proces includes overhead welied of 110.000 10.00 Hatshed since verhaled of 1,000 . Cost of goods sold includes overhead Aplied of 500,00) $ 1,400,000 Required: 1 Compute the underapplied or overapplied overhead 2. Assume that the company coses any underapplied or overapplied overhead to Cost of Goods Sold. Prepare the appropriate journal entry 3. Assume that the company allocates any underapplied or overapplied overhead proportionally to Work in Process, Finished Goods and Cost of Goods So epare the appropriate journal entry 4. How much higher or lower wil net operating income be if the underapplied or overapplied overhead is allocated to Work in Process Finished Goods, and cost of Good Sold rather than being closed to cost of Goods Sold? Capote this poustion ly entering your answers in the tabs below. Required Hed Compute the underapplied overed Required 2 > Required 1 Required 2 Required 3 Required 4 Assume that the company closes any underapplied or overapplied overhead to Cost of Goods Sold. Prepare the app (If no entry is required for a transaction/event, select "No journal entry required in the first account field.) View transaction list Journal entry worksheet Required 1 Required 2 Required 3 Required 4 ok Assume that the company allocates any underapplied or overapplied overhead proportionally to work in Cost of Goods Sold. Prepare the appropriate journal entry. (If no entry is required for a transaction/event required" in the first account field.) ences View transaction list Journal entry worksheet