Overhead Variances and Their Disposal Warner Company has the following data for the past year: Actual overhead $222,000 Applied overhead: $52,000 Work-in-process inventory Finished goods inventory 104,000 Cost of goods sold 104,000 Total $260,000 Warner uses the overhead control account to accumulate both actual and applied overhead. Required: 1. Calculate the overhead variance for the year. 38,000 Overapplied Feedback Provide the appropriate adjusting journal entry to close the overhead variance to Cost of Goods Sold. Overhead Control 38,000 | Cost of Goods Sold 38,000 2. Assume the variance calculated is material. After prorating, close the variances to the appropriate accounts. If an amount box does not require an entry, leave it blank. Overhead Control 38,000 Cost of Goods Sold 15,200 Work-in-Process Inventory - 7,600 Finished Goods Inventory 15,200 Feedback Assume the variance calculated is material. After prorating, provide the final ending balances of these accounts. Adjusted Unadjusted Balance Prorated Overapplied Overhead Balance Work-in-Process Inventory $52,000 7,600 44,400 Finished Goods Inventory $104,000 $ 15,200 $ 88,800 Cost of Goods Sold $104,000 15,200 88,000 x Feedback 3. What if the variance is of the opposite sign calculated in Requirement 1? Provide the appropriate adjusting journal entries for Requirements 1 and 2. For a compound transaction, if an amount box does not require an entry, leave it blank. Variance immaterial Cost of Goods Sold 38,000 Overhead Control 38,000 7,600 x Variance material Cost of Goods Sold Work-in-Process Inventory Finished Goods Inventory EILIG 15,200 X 15,200 Overhead Control 38,000