Reference no: EM132659518

Easy Decorating uses a job-order costing system to collect the costs of its interior decorating business. Each client's consultation is treated as a separate job. Overhead is applied to each job based on the number of decorator hours incurred. Listed below are data for the current year:

Estimated overhead $936,100
Actual overhead $964,000
Estimated decorator hours 40,700
Actual decorator hours 41,490

• The company uses Operating Overhead in place of Manufacturing Overhead.

Question 1: Calculate the predetermined overhead rate.

Question 2: Prepare the entry to apply the overhead for the year. (Credit account titles are automatically indented when the amount is entered. Do not indent manually.)

Question 3: Determine whether the overhead was under- or over-applied and by how much.