#4

Mango Company applies overhead based on direct labor costs. For the current year, Mango Company estimated total overhead costs to be $400,000, and direct labor costs to be $200,000. Actual overhead costs for the year totaled $425,000, and actual direct labor costs totaled $226,000. At year-end, Factory Overhead account is:

a) Overapplied by $26,000.

b) Overapplied by $226,000.

c) Neither overapplied nor underapplied

d) Underapplied by $27,000.

e) Overapplied by $27,000