The Hazy Radiator Company uses a normal-costing system with a single manufacturing overhead cost pool and machine-hours as the cost-allocation base. The following data are for 2017:

Budgeted manufacturing overhead costs $ 4,900,000 Overhead allocation base Machine-hours Budgeted machine-hours 70,000 Manufacturing overhead costs incurred $ 5,150,000 Actual machine-hours 65,000 Machine-hours data and the ending balances (before proration of under- or overallocated overhead) are as follows: Actual Machine-Hours 2017 End-of-Year Balance Cost of Goods Sold 48,000 $ 7,500,000 Finished Goods Control 10,000 1,500,000 Work-in-Process Control 7,000 1,000,000 1. Compute the budgeted manufacturing overhead rate for 2017. 2. Compute the under- or overallocated manufacturing overhead of Hazy Radiator in 2017. Dispose of this amount using the following: a. Write-off to Cost of Goods Sold b. Proration based on ending balances (before proration) in Work-in-Process Control, Finished Goods Control, and Cost of Goods Sold c. Proration based on the overhead allocated in 2017 (before proration) in the ending balances of Work-in-Process Control, Finished Goods Control, and Cost of Goods Sold 3. Which method do you prefer in requirement 2? Explain