Cambridge Manufacturing Company applies manufacturing overhead on the basis of machine hours. At the beginning of the year, the company estimated its total overhead cost to be $325,000 and machine hours to be 25,000. Actual manufacturing overhead and machine hours were $372,000 and 26,000, respectively.

Required:

1. & 2. Prepare the journal entries for actual and applied manufacturing overhead and transfer of manufacturing overhead account balance to cost of goods sold.

a) record actual manufacturing overhead cost incurred

b).record the application of manufacturing overhead to production

c). record the transfer of manufacturing overhead account balance to cost of goods sold