A. Bonita, Inc. manufactures ergonomically designed computer furniture. Bonita uses a job order costing system. On November 30, the Work in Process Inventory consisted of the following jobs:

CC723		Computer caddy		15,000			$503,050
CH291		Chair		10,000			246,800
PS812		Printer stand		17,000			135,000
							$884,850

On November 30, Bonitas Raw Materials Inventory account totaled $122,000, and its Finished Goods Inventory totaled $536,000. Bonita applies manufacturing overhead on the basis of machine hours. The companys manufacturing overhead budget for the year totaled $2,184,000, and the company planned to use 156,000 machine hours during the year. Through the first eleven months of the year, the company used a total of 118,000 machine hours, total manufacturing overhead amounted to $1,818,700, and Cost of Goods Sold was $4,680,000.

Bonita purchased $638,000 in raw materials in December and incurred the following costs for jobs in process that month:

Job No.		Materials Issued		Machine Hours		Direct Labor Hours		Direct Labor Cost
CC723		$85,000		4,250		9,600		$115,200
CH291		$7,000		650		2,400		$28,800
PS812		$110,000		4,400		14,300		$171,600
DS444		$123,000		2,200		8,700		$104,400

The following jobs were completed in December and transferred to the Finished Goods Inventory:

Job No.		Item		Units
CC723		Computer caddy		15,000
CH291		Chair		10,000
DS444		Desk		5,00

Assume that Bonita sold 8,200 computer caddies, 8,000 chairs, and 4,500 desks in December.

Bonita incurred $172,800 in manufacturing overhead in December. Given that expenditure, was manufacturing overhead under- or overapplied for the year? By how much?

*Overhead (Underapplied/Overapplied) by ____?*

B.

Assume that Bonita closes under- or overapplied overhead to the Cost of Goods Sold account. Prepare the journal entry to close the manufacturing overhead account. (Credit account titles are automatically indented when the amount is entered. Do not indent manually.)

Account Titles and Explanation	Debit	Credit

C. Assume that Bonita prorates under- or overapplied overhead to the appropriate accounts. Calculate the allocated amounts and adjust the account balances as needed. (Round % of total answers to 1 decimal places, e.g. 52.7% and other answers to 0 decimal places e.g. 5,275.)

	Ending balance	% of total	Allocation	Adjusted balance
work in progress	$	%	$	$
finished goods
cost of goods sold