Exercise 3-8 (Algo) Applying Overhead; Journal Entries; Disposing of Underapplied or Overapplied Overhead (LO3-1, LO3-2, LO3-4) The following information is taken from the accounts of Latta Company. The entries in the T-accounts are summaries of the transactions that affected those accounts during the year. Manufacturing Overhead 474,624 (6) 395,520 79,104 (a) Bal. Bal. 734,000 Work in Process 15,480 (c) 281,000 88,000 395,520 46,000 652,000 Finished Goods 44,000 (d) 734,000 126,000 Bal. (c) Bal. (b) Bal. Cost of Goods Sold 652,000 (d) The overhead that had been applied to production during the year is distributed among Work in Process, Finished Goods, and Cost of Goods Sold as of the end of the year as follows: Work in Process, ending Finished Goods, ending Cost of Goods Sold Overhead applied $ 22,080 60,480 312,960 $ 395,520 For example, of the $46,000 ending balance in work in process, $22.080 was overhead that had been applied during the year. Required: 1. Identify reasons for entries (a) through (d). 2. Assume that the underapplied or overapplied overhead is closed to Cost of Goods Sold. Prepare the necessary journal entry. 3. Assume that the underapplied or overapplied overhead is closed proportionally to Work in Process, Finished Goods, and Cost of Goods Sold. Prepare the necessary journal entry