Problem II ABC Company is manufacturing firm that uses Job-order costing. On January 01, 2022 the Company's inventory balances were as follows: Raw materials Work in process Finished goods $3,750 2,812 5,625 The company applies overhead cost to jobs on the basis of machine-hours worked. For 2022 the company estimated that it would work 14,062 machine-hours and incur $84,375 in manufacturing overhead cost. The following transactions were recorded for the year: a. Raw materials were purchased on credit, $ 76,875. b. Raw materials were requisitioned for use in production: $ 71,250 (70% direct and 30% indirect). c. The following costs were incurred for employee service: direct labor $ 14,065 and indirect labor $20,625, sales commissions $ 16,875, and administrative salaries $ 37,500 d. Sales travel costs were incurred $3,188. e. Utilities costs were incurred $ 8,063. f Advertising cost were incurred $ 33,750. g Depreciation was recorded for the year: $ 65,625 (70% related to factory operations, 30% related to selling and administrative activities). h. Insurance expired during the year $1,875 (70% related to factory operations, and the remaining 30% related to selling and administrative activities). J i Manufacturing overhead was applies to production. Due to less than expected demand for its products, the company worked 13,875 machine-hours during the year. Goods costing $ 168,750 to manufactured were completed during the year. k Goods were sold on account to customers during the year at a total selling price of $ 295,000. The cost of goods sold are $175.500. Required: 1. Prepare Journal entries to recorded all of the transactions above. 2. Is manufacturing Overhead Under applied or Over applied for the year? Prepare Journal entries to close any balance in manufacturing overhead (MOH) account to the Cost of Goods Sold (COGS) account.