Broadway Firm uses a normal job-costing system. Manufacturing overhead is allocated using a budgeted rate of 1.5 times (150% of) the direct labor cost. Any over- or under-allocated manufacturing overhead is closed to the Cost of Goods Sold account at the end of each year. Additional information is available as follows:

Job 101 was the only job in process at January 1, 2016. The job cost sheet for this job contained the following costs at the beginning of the month:

Direct materials $4,000

Direct labor 2,000

Allocated manufacturing overhead 3,000

Jobs 102, 103, and 104 were started during 2016. Direct materials used in 2016 totaled $26,000. Direct labor cost of $20,000 was incurred in 2016. Actual manufacturing overhead was $32,000 in 2016. The only job still in process at December 31, 2016 was Job 104, with costs of $2,800 for direct materials and $1,800 for direct labor. For 2016, the manufacturing overhead was:

1. For 2016, the manufacturing overhead was:

A. $700 overapplied

B. $1,000 overapplied

C. $2,000 overapplied

D. $2,000 underapplied

2. The cost of goods manufactured for 2016 was:

A. $77,700

B. $78,000

C. $79,700

D. $85,000