Overhead Variances and Their Disposal

Warner Company has the following data for the past year:

Actual overhead	$318,500
Applied overhead:
Work-in-process inventory	$68,000
Finished goods inventory	136,000
Cost of goods sold	136,000
Total	$340,000

Warner uses the overhead control account to accumulate both actual and applied overhead.

Required:

1. Calculate the overhead variance for the year. $ ___________

-Underapplied/ Overapplied ?

Provide the appropriate adjusting journal entry to close the overhead variance to Cost of Goods Sold