3.1 Assume the company closes any underapplied or overapplied overhead directly to Cost of Goods Sold. Prepare the appropriate journal entry. (If no entry is required for a transactionlevent, select "No journal entry required" in the first account field.) View transaction list Journal entry worksheet Record the appropriate journal entry to close any underapplied or overapplied overhead directly to Cost of Goods Sold. Note: Enter debits before credits. Transaction General Journal Debit Credit Record entry Clear entry View general journal 3.2 Will this entry increase or decrease net operating income? This entry will increase net operating income. This entry will decrease net operating income. Adriana Company is highly automated and uses computers to control manufacturing operations. The company uses a job-order costing system and applies manufacturing overhead cost to products on the basis of computer-hours. The following estimates were used in preparing the predetermined overhead rate at the beginning of the year: Computer-hours Fixed manufacturing overhead cost Variable manufacturing overhead per computer-hour 97,000 $1,571,400 $ 3.50 During the year, a severe economic recession resulted in cutting back production and a buildup of inventory in the company's warehouse. The company's cost records revealed the following actual cost and operating data for the year: 70.000 $ 1,428,000 Computer-hours Manufacturing overhead cost Inventories at year-end: Raw materials Work in process Finished goods Cost of goods sold $ 510,000 $ 300,000 $ 1,120,000 $ 2,860,000 Required: 1. Compute the company's predetermined overhead rate for the year. (Round your answer to two decimal places.) Predetermined overhead rate per hour 2. Compute the underapplied or overapplied overhead for the year. (Round your final answer to the nearest dollar amount.) overhead cost