ASSIGNMENT ONE : Wood Grain Technology makes home office furniture from fine hardwoods . The company uses a job order costing system and predetermined overhead rates to apply manufacturing overhead cost to jobs . The predetermined overhead rate in the Preparation Department is based on machine - hours , and the rate in the Fabrication Department is based on direct materials cost . At the beginning of the year , the company's management made the following estimates for the year :* Preparation Fabrication Machine Hours 80,000 Direct Labor Hours 35 , 000 21, 000 65, 000 Direct Material Cost $190 , 000 $ 400 , 000 Direct Labor Cost $280, 000 Manufacturing Overhead $416, 000 $530,000 $ 720, 000 Job 127 was started on April 1 and completed on May 12 . The company's cost records show the following information concerning the job : Preparation Fabrication Machine Hours 350 70 Direct Labor Hours 80 130 Direct Material Cost $940 $1 , 200 Direct Labor Cost $710 $980 Required :` 1 . Compute the predetermined overhead rate used during the year in the Preparation Department . Compute the rate used in the Fabrication Department . 2. Compute the total overhead cost applied to Job 127 . 3. What would be the total cost recorded for Job 127 ? If the job contained 25 units , what would be the unit product cost ? 1. At the end of the year , the records of WoodGrain Technology revealed the following actual cost and operating data for all jobs worked on during the year :* Preparation Fabrication Machine Hours 73, 000 24, 000 Direct Labor Hours 30, 000 $165 , 000 68, 000 Direct Material Cost $ 420, 000 Manufacturing Overhead $390,000 $740, 000 What the amount was of under applied or over applied overhead in each department at the end of the year ?" 5 . If the applied overhead is considered as period cost then give the disposal entry