The following information is taken from the accounts of Latta Company. The entries in the T-accounts are summaries of the transactions that affected those accounts during the year.

Manufacturing Overhead
(a)	460,000	(b)	390,000
Bal.	70,000

Work in Process
Bal.	15,000	(c)	710,000
	260,000
	85,000
(b)	390,000
Bal.	40,000

Finished Goods
Bal.	50,000	(d)	640,000
(c)	710,000
Bal.	120,000

Cost of Goods Sold
(d)	640,000

The overhead that had been applied to production during the year is distributed among Work in Process, Finished Goods, and Cost of Goods Sold as of the end of the year as follows:

Work in Process, ending	$	19,500
Finished Goods, ending		58,500
Cost of Goods Sold		312,000
Overhead applied	$	390,000

For example, of the $40,000 ending balance in work in process, $19,500 was overhead that had been applied during the year.

Required:

1. Identify reasons for entries (a) through (d).

2. Assume that the underapplied or overapplied overhead is closed to Cost of Goods Sold. Prepare the necessary journal entry.

3. Assume that the underapplied or overapplied overhead is closed proportionally to Work in Process, Finished Goods, and Cost of Goods Sold. Prepare the necessary journal entry.