Maverick Wings, Inc. manufactures airplanes for use in stunt shows. Maverick's factory is highly automated, using the latest in robotic technology. To keep costs low, the company employs as few factory workers as possible. Since each plane has different features (such as its shape, weight, and color), Maverick uses a job order costing system to accumulate product costs. At the end of 2013, Maverick's accountants developed the following expectations for 2014 based on the marketing department's sales forecast: 
Maverick's inventory count, completed on December 31, 2013, revealed the following ending inventory balances: 
The company's 2014 payroll data revealed the following actual payroll costs for the year: 
The following information was taken from Maverick's Schedule of Plant Assets. All assets are depreciated using the straight-line method. 
Other miscellaneous costs for 2014 all paid in cash included: 
Additional information about Maverick's operations in 2014 includes the following:
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What was Maverick's predetermined overhead rate in 2014? (Round answer to 2 decimal places, e.g. 2.45%.)
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Prepare the journal entries to record Maverick's costs for 2014. (Use Salaries Payable and Wages Payable accounts for payroll costs.) (Credit account titles are automatically indented when the amount is entered. Do not indent manually. Post entries in order presented in the problem. Round answers to 0 decimal places, e.g. 345,000.)
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Prepare the appropriate T-accounts for Raw Materials Inventory, Work-in-Process Inventory, Finished Goods Inventory, Manufacturing Overhead Control, Cost of Goods Sold, and Sales, and record Maverick's transactions for 2014. (Post entries in order presented in the problem. Round answers to 0 decimal places, e.g. 345,000.)
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Was manufacturing under- or overapplied in 2014? By how much? (Round answer to 0 decimal places, e.g. 345,000.)
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Make the adjusting entry necessary to close the under- or overapplied overhead to cost of goods sold. (Credit account titles are automatically indented when the amount is entered. Do not indent manually. Round answers to 0 decimal places, e.g. 345,000.)
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If Maverick chooses instead to prorate under- or overapplied overhead, what would the adjusted balances be in Work in Process Inventory, Finished Goods Inventory, and Cost of Goods Sold for 2014? (Round answers to 0 decimal places, e.g. 345,000 and percentage of total to 2 decimal places e.g. 34.52).
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Job 3827 was started and completed in 2014. The job required 1,200 machine hours, 300 direct labor hours, and $76,000 in direct materials to complete. What was the total cost of this job? Using Maverick's 80% markup, what sales price would be charged for this airplane? (Round answers to 0 decimal places, e.g. 345,000.)
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If Maverick had chosen to use machine hours as its overhead application base, what would the rate have been in 2014? (Round answer to 2 decimal places, e.g. 2.45.)
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