Trenton Ltd. uses a normal job-costing system and applies manufacturing overhead to products on the basis of machine hours. At the beginning of 2012, the company controller budgeted annual overhead at $1,500,000. She also forecast that machine hours would total 48,000. Actual costs were as follows:

Direct material (DM) used........ $ 340,000

Direct labour.............. $ 875,000

Manufacturing overhead (MOH)...$1,605,000

Actual machine hours worked during the year were 49,200. Trenton adjusts any under-allocated or over-allocated overhead to cost of goods sold. The company’s records show that total sales for the year were $2,938,000 and cost of goods sold (before adjustment) equaled $2,260,000.

REQUIRED

1. Determine the company’s budgeted overhead rate.

2. Determine the amount of under-allocated or over-allocated overhead for the year.

3. Compute the company’s cost of goods sold.