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 $$2\mathrm{.}50$ per machine$-$hour was based on a cost formula that estimates $$242,500$ of total manufacturing overhead for an estimated activity level of $97,000$ machine$-$hours.

Required:

Assume that during the year the company works only $92,000$ 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.