Premium Company produces uniforms. The company allocates manufacturing overhead based on the machine hours each job uses. Premium Company reports the following cost data for the past year:

Requirements
1. Compute the predetermined manufacturing overhead rate.
2. Calculate the allocated manufacturing overhead for the past year.
3. Compute the underallocated or overallocated manufacturing overhead. How will this underallocated or overallocated manufacturing overhead be disposed of?
4. How can managers use accounting information to help control manufacturing overhead costs?

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Budget Actual Direct labor h Machine hours Depreciation on salespeople's autos Indirect materials Depreciation on trucks used to deliver uniforms 7,100 hours 6,800 hours S23,500 S52,000 6,500 hours 6,800 hours S23,500 S54,500 to custome Depreciation on plant and equipment.. Indirect manufacturing labor Customer service hotline Plant utilities Direct labor cost $13,500 S64,000 S39,500 $21,500 $ 900 $71,000 $11,000 S65,500 $41,500 S23,000 $ 1,900 $85,000