Bultz company manufactures an energy drink. The company uses a budgeted indirect-cost rate for it's manufacturing operations and during 2014 allocated 1,000,000$ to work in process inventory. Actual overhead incurred was 1,200,000$. Ending balances are: Work in process 100,000$ Finished Goods 750,000$ Cost of Goods sold 4,150,000

a. Prepare a journal entry to write off the difference between allocated and actual overhead directly to Cost of Goods Sold. Be sure your journal entry closes the related overhead accounts.

b. Prepare a journal entry that prorates the write-off of the difference between between allocated and actual overhead using ending account balances. Be sure your journal entry closes the related overhead costs