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

Manufacturing Overhead Work in Process

(a) 353,000 (b) 429,000 Bal. 105,600 (c) 780,500 210,100

Bal. 76,000 115,100

(b) 429,000

Bal.79, 300

Finished Goods Cost of Goods Sold

Bal. 145,000 (d) 827,500 (d) 827,500

(c) 780,500

Bal. 98,000

The overhead that had been applied to production during the year is distributed among the ending balances in the accounts as follows:

Work in process, ending $ 55,770

Finished goods, ending 111,540

Cost of goods sold 261,690

Overhead applied $ 429,000

For example, of the $79,300 ending balance in work in process, $55,770 was overhead that had been applied during the year.

Requirement:
1. Identify the reasons for entries (a) through (d)
2. Assume that the company closes any balance in the manufacturing overhead account directly to cost of goods sold. Prepare the necessary journal entry.

Assume instead that the company allocates any balance in the manufacturing overhead account to the other accounts in proportion to the overhead applied during the year that is in the ending balance in each account. Prepare the necessary journal entry, with supporting computations.