Adams Manufacturing allocates overhead to production on the basis of direct labor costs. At the beginning of the year, Adams estimated total overhead of $322,000; materials of $420,000 and direct labor of $230,000. During the year Adams incurred $428,000 in materials costs, $415,600 in overhead costs and $234,000 in direct labor costs. Compute the overhead application rate. 140%. 178%. 71%. 182%. 77%.