Harwood Company uses a job$-$order costing system that applies overhead cost to jobs on the basis of machine$-$hours. The company's

predetermined overhead rate of $$2\mathrm{.}40$ per machine$-$hour was based on a cost formula that estimates $$225,600$ of total manufacturing

overhead for an estimated activity level of $94,000$ machine$-$hours.

Required:

Assume that during the year the company works only $89,000$ machine$-$hours and incurs the following costs in the Manufacturing

Overhead and Work in Process accounts: Compute the amount of overhead cost that would be applied to Work in Process for the year

and make the entry in your T$-$accounts.

$2$A$.$ Compute the amount of underapplied or overapplied overhead for the year and show the balance in your Manufacturing

Overhead T$-$account.

$2$B$.$ Prepare a journal entry to close the company's underapplied or overapplied overhead to Cost of Goods Sold.

Complete this question by entering your answers in the tabs below.

Req $2$B

Prepare a journal entry to close the company's underapplied or overapplied overhead to Cost of Goods Sold. $($If no entry is required for a

transaction$/$event$,$ select $"$No journal entry required" in the first account field.$)$

Journal entry worksheet

$1$

Record the entry to close the balance of the manufacturing overhead account

to COGS account.

Note: Enter debits before credits.