Overhead Variance (Over- or Underapplied), Closing to Cost of Goods Sold

At the end of the year, Pryor Company provided the following actual information:

Overhead: $423,160

Direct labour cost: $596,000

Pryor uses normal costing and applies overhead at the rate of 70% of direct labour cost. At the end of the year, Cost of Goods Sold (before adjusting for any overhead variance) was $979,000.

Required:

1.Calculate the overhead variance for the year.

$

2.Dispose of the overhead variance by adjusting Cost of Goods Sold.

Adjusted COGS $