Application of Overhead Tomek Company uses a job costing system that applies factory overh...

Application of Overhead Tomek Company uses a job costing system that applies factory overhead on the basis of direct labor hours. The company’s factory overhead budget for the current year included the following estimates:

At the end of the year, the company shows these results:

Required

1. Compute the firm’s predetermined factory overhead rate for the current year.

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2. Calculate the amount of overapplied or underapplied overhead.

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3. Prepare a journal entry to transfer the underapplied or overapplied overhead to the Cost of Goods Sold account.