Required: From the information given below: 1. Calculate the predetermined overhead rate. 2. Calculate any under-or overapplied overhead. 3. Prepare the journal entry to write off any under- or overapplied overhead against cost of goods sold. Canada Traders Pty Ltd, manufacturer containers for the food industry. The company has installed a job order costing system and uses machine hours to apply its overhead to work in process. On 1 September 2020, the management estimated that the company would incur $1 360 000 in manufacturing overhead costs and 128 000 machine hours for the coming year. During September 2020 Canada Traders used 122 000 machine hours and incurred the following costs: Repairs and maintenance Depreciation Indirect materials Utilities and supplies Insurance $ 128 000 420 000 168 000 344 000 184 000 Solution: A. Predetermined overhead rate: B. Over/Under applied overheads: C. Journal entry DR CR