Latta Company provided the following T-accounts for this year.

Manufacturing Overhead
Debit	Credit
(a)	488,448	(b)	407,040
Balance	81,408

Work in Process
Debit	Credit
Balance	9,960	(c)	758,000
	302,000
	91,000
(b)	407,040
Balance	52,000

Finished Goods
Debit	Credit
Balance	38,000	(d)	664,000
(c)	758,000
Balance	132,000

Cost of Goods Sold
Debit	Credit
(d)	664,000

The overhead applied to production is distributed among Work in Process, Finished Goods, and Cost of Goods Sold at the end of the year as follows:

Work in Process, ending	$ 24,960
Finished Goods, ending	63,360
Cost of Goods Sold	318,720
Overhead applied	$ 407,040

For example, of the $52,000 ending balance in work in process, $24,960 was applied overhead.

Required:

1. Identify reasons for entries (a) through (d).
2. Assume underapplied or overapplied overhead is closed to Cost of Goods Sold. Prepare the necessary journal entry.
3. Assume underapplied or overapplied overhead is closed proportionally to Work in Process, Finished Goods, and Cost of Goods Sold. Prepare the necessary journal entry.