Finlon Upholstery Inc. uses a job-order costing system to accumulate manufacturing costs. The companys work-in-process on December 31, 2001, consisted of one job (no. 2077), which was carried on the year-end balance sheet at $156,800. There was no finished-goods inventory on this date.Finlon applies manufacturing overhead to production on the basis of direct-labor cost. (The budgeted direct-labor cost is the companys practical capacity, in terms of direct-labor hours multiplied by the budgeted direct-labor rate.) Budgeted totals for 2002 for direct labor and manufacturing overhead are $4,200,000 and $5,460,000, respectively. Actual results for the year are as follows: Actual Results Direct Materials Used$5,600,000.00 Direct Labor$4,350,000.00 Indirect Material Used$65,000.00 Indirect Labor$2,860,000.00 Factory Depreciation$1,740,000.00 Factory Insurance$59,000.00 Factory Utilities$830,000.00 Selling and Administrative Expenses$2,160,000.00 Total$17,664,000.00 Job no. 2077 was completed in January 2002, and there was no work in process at year-end. All jobs produced during 2002 were sold with the exception of Job no. 2143, which contained direct-material costs of $156,000 and direct-labor charges of $85,000. The company charges any under- or over-applied overhead to the cost of goods sold category.Using the above information, do the following: Calculate the companys predetermined overhead application rate.Calculate the additions to the work-in-process inventory account for the direct material used, direct labor, and manufacturing overhead.Calculate the finished-goods inventory for the 12/31/02 balance sheet.Calculate the over-applied or under-applied overhead at year-end.Explain if it is appropriate to include selling and administrative expenses in the cost of goods sold category. Perform your calculations in an Excel spreadsheet and copy the calculations into a Word document.Write a 1-page paper in Word format. Apply APA standards to citation of sources.