Apple Ltd manufactures all types of custom-made premium s shoes. It uses a job-costing system and applies manufacturing overhead on the basis of machine hours. The company's manufacturing overhead budget for the year totalled $1,600,000. It has a maximum capacity of 400,000 machine hours. However, it is budgeted to be able to use 80% of this capacity during this period.

On 30 Jun, Apple Ltd has the following balances:

Work in process inventory

Job number 211 $22,500

Job number 212 $10,775

Raw materials inventory $16,700

Finished goods inventory

Job number 210 $28,750

In July, the following occurred:

(1) Raw materials purchased on credit

(2) Raw materials requisitions

-Job number 211 $1,275

-Job number 212 $750

-Job number 213 $3,100

-Indirect materials (used in production) $750

(3) Machine hours, direct labour hours and wages for factory employees

-Job number 211

Machine hours 3,000

Labour hours 2,900

Wages $30,600

-Job number 212

Machine hours 1,100

Labour hours 900

Wages $10,800

-Job number 213

Machine hours 4,875

Labour hours 3,575

Wages $50,125

-Indirect labour 750 and wages $7,350

(4)Other overhead incurred:

Depreciation - machineries $5,000

Depreciation - delivery vans $500

Salaries - production $12,500

Salaries - sales and administration $8,750

Other factory costs $19,500

Other selling and administration costs $12,000

(5) Spoilage & reworked costs

-Job number 211

Normal spoilage with estimated disposal selling price of $75 was incurred.

-Job number 212

Normal spoilage amounting to $88 and abnormal spoilage of $38 were incurred.

-Job number 213

Rework cost of $65 was incurred.

(6) Job number 211 and Job number 212 were completed during the month.

(7) Job number 210 was sold for cash at a mark-up of 30% on cost while Job number 211 was sold on credit at a price that allow the company to earn a gross profit margin of 20%.

Required:

(a) Compute the pre-determined overhead rate.

(b) Calculate the followings:

(i) Raw materials inventory as at 31 July.

(ii) Work in process as at 31 July.

(iii) Finished goods inventory as at 31 July.

(iv) Selling price for Job number 210 and Job number 211.

(c) Prepare the necessary journal entries to describe and summarise the transactions for July. Please show each job separately for the work in process inventory accounts only. Narrations can be ignored.

(d) Compute the over-applied or under-applied overhead for July.

(e) Explain how the over-applied or under-applied overhead should be treated.

(f) Provide the necessary journal entries to close off the balance in the overhead control account assuming:

(i) The overhead variances are not significant.

(ii) The overhead variances are significant.

Provide your final answer to the nearest dollar.