(Predetermined Oil rates) Cairo Products applies overhead using a combined rate for fixed and variable overhead. The rate has been established at 175 percent of direct labor cost. During' the first three months of the current year, actual costs were incurred as follows:

a. What amount of overhead was applied to production in each of the three months?

b. What was the underapplied or overapplied overhead for each of the three months and for the first quarter?LO1.

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January February March Direct Labor Cost $360,000 330,000 340,000 Actual Overhead $640,000 570,400 600,000