Problem 2-22A Predetermined Overhead Rate; Disposition of Underapplied or Overapplied Overhead [LO2-1, LO2-7] Luzadis Company makes furniture using the latest automated technology. The company uses a job-order costing system and applies manufacturing overhead cost to products on the basis of machine-hours. The following estimates were used in preparing the predetermined overhead rate at the beginning of the year 88,000 $1,279,000 Machine-hours Fixed manufacturing overhead cost Variable manufacturing overhead per computer-hour $ 3.20 During the year, a glut of furniture on the market resulted in cutting back production and a buildup of furniture in the company's warehouse. The company's cost records revealed the following actual cost and operating data for the year 50,000 $940,000 Machine-hours Manufacturing overhead cost Required: 1. Compute the company's predetermined overhead rate for the year. (Round your answer to 2 decimal places.) Predetermined overhead rate per hour 2. Compute the underapplied or overapplied overhead for the year. (Round your intermediate calculations to 2 decimal places.) 3. Assume the company closes any underapplied or overapplied overhead directly to Cost of Goods Sold. Prepare the appropriate entry. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field. Round your intermediate calculations to 2 decimal places.) View transaction list Journal entry worksheet 1 Record the entry to close the balance in the manufacturing overhead account to the cost of goods sold account. Note: Enter debits before credits. Debit Credit General Journal Event 1 View general journal Record entry Clear entry