A company uses an overhead absorption rate of $350 per machine hour, based on 32,000 budgeted machine hours for the period. During the same period the actual total overhead expenditure amounted to $108,875 and 30,000 machine hours were recorded on actual production.

By how much was the total overhead under or over absorbed for the period?

A Under absorbed by $3,875

B Under absorbed by $7,000

C Over absorbed by $3,875

D Over absorbed by $7,000