Teacher's Pet prints custom training material for corporations. The business was started January $1,2020.$ The company uses

a normal$-$costing system. It has two direct$-$cost pools, materials and labor, and one indirect$-$cost pool, overhead. Overhead is charged to

printing jobs on the basis of direct labor cost. The following information is available for $2020.$

$($Click the icon to view the following data.$)$

$($Click the icon to view the following data.$)$

Requirement $1.$ Compute the overhead allocation rate. Select the formula and enter the amounts to calculate the overhead allocation ra

$]1$

$=$

$=$ Overhead allocation rate

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There were two jobs in process on December $31,2020$: Job $11$ and Job $12.$ Costs added to each job as of December $31$ are

as follows:

$($Click the icon to view the costs.$)$

Teacher's Pet has no finished$-$goods inventories because all printing jobs are transferred to cost of goods sold when completed.

Read the requirements.

Data table

Requirements

Compute the overhead allocation rate.

Calculate the balance in ending work in process and cost of goods sold before any

adjustments for under$-$ or overallocated overhead.

Calculate under$-$ or overallocated overhead.

Calculate the ending balances in work in process and cost of goods sold if the under$-$ or

overallocated overhead amount is as follows:

a$.$ Written off to cost of goods sold

b$.$ Prorated using the overhead allocated in $2020($before proration$)$ in the ending

balances of cost of goods sold and work$-$in$-$process control accounts

Which of the methods in requirement $4$ would you choose? Explain.