$ 4,080,000 170,000 Budgeted manufacturing overhead costs Budgeted direct labor-hours Actual manufacturing overhead costs Actual direct labor-hours $ 4,261,000 178,000 Requirement 1. Compute the budgeted manufacturing overhead rate. Enter the formula, then enter the amounts to calculate the budgeted manufacturing overhead rate. Budgeted manufacturing overhead rate = . = Requirement 2. Prepare the summary journal entry to record the allocation of manufacturing overhead. (Record debits first, then credits. Exclude explanations from any journal entries.) Journal Entry Accounts Debit Credit Requirement 3. Compute the amount of under- or overallocated manufacturing overhead. Is the amount significant enough to warrant proration of overhead costs, or should Phelps Woodworking write it off to cost of goods sold? Prepare the journal entry to dispose of the under- or overallocated overhead. Enter the formula, then enter the amounts to calculate the over- or underallocated manufacturing overhead. (Use parentheses or a minus sign to report overallocated overhead.) = Underallocated (Overallocated) Is the amount significant enough to warrant proration of overhead costs, or should Phelps Woodworking write it off to cost of goods sold? the difference The is amount of difference compared to manufacturing overhead costs allocated. If the quantities of work-in-process and finished goods inventories are between proration and write off to Cost of Goods Sold account would be compared to net income. Prepare the journal entry to dispose of the under- or overallocated overhead. (Record debits first, then credits. Exclude explanations from any journal entries.) Journal Entry Accounts Debit Credit