Chapter 03 Pre-Built Problems Check my work 3 Luzadis Company makes furniture using the latest automated technology. The company uses a job-order costing system and applies manufacturing overhead cost to products on the basis of machine-hours. The predetermined overhead rate was based on a cost formula that estimates $1,066,000 of total manufacturing overhead for an estimated activity level of 82,000 machine-hours. 10 During the year, a large quantity of furniture on the market resulted in cutting back production and a buildup of furniture in the e. The company's cost records revealed the following actual cost and operating data for the year 68,000 $ 1,029,000 Print 17,000 192,000 288,000 Pinished gooda tincludes overhead applied of $132,600) Cost of goods sold ( ineludes overhead applied of $663,000) $ 1,440,000 1. Compute the underapplied or overapplied overhead. 2. that the company closes any underapplied or overapplied overhead to Cost of Goods Sold. Prepare the appropriate journal 3. Assume that the company allocates any underapplied or overapplied overhead proportionaly to Work in Process, Finished Goods, and Cost of Goods Sold. Prepare the appropriate journal entry. 4. How much higher or lower will net operating income be if the underapplied or overapplied overhead is allocated to Work in Process Finished Goods, and Cost of Goods Sold rather than being closed to Cost of Goods Sold? Complete this question by entering your answers in the tabs below.