In 2005, Design Cabinetry, Incorporated applied overhead to jobs using a predetermined overhead rate based on labor hours.

The following information relates to 2005 estimated and actual results:

Estimated overhead costs $1,600,000

Estimated labor hours 50,000

Actual overhead costs $1,550,000

Actual labor hours 48,000

Determine the amount of misapplied overhead for the year. Was it over-or under-applied?

Reference the answer to Part (a). Assume that the amount of misapplied overhead is immaterial and is therefore closed to the cost of goods sold. If the cost of goods sold was $12,000,000 before consideration of misapplied overhead, what is the adjusted cost of goods sold that would appear on a full-costing income statement?