Budgeted manufacturing overhead cost $100000 Budgeted direct manufacturing labor

Budgeted manufacturing overhead cost $100000 Budgeted direct manufacturing labor cost $200000 Actual manufacturing overhead cost $106000 Actual direct manufacturing labor cost $220000Inventory balances on dec 31 2009 were:Account Ending balance 2009 direct manufacturing labor cost in ending balance
Work in process $50000 $20000
Finished goods $240000 $60000
Cost of goods sold $ 560000 $1400001. Calc the overhead allocation rate
2. Compute the amount of under or over allocated overhead 3. Calc the ending balances in work in process finished goods and cost of goods sold if under/overallocated overhead is:
a. written off cogs
b. prorate based on ending bal (before proration) in each of 3 accounts c. prorate based on the overhead allocated in 2009 in the ending balance (before proration) in each of the three accounts 4. which method makes most sense? justify your answer.