Baker Corporation applies manufacturing overhead on the basis of direct labor-hours. At the beginning of the most recent year, the company based its predetermined overhead rate on total estimated overhead of $70,800 and 2,400 estimated direct labor-hours. Actual manufacturing overhead for the year amounted to $72,500 and actual direct labor-hours were 2,250.

- $6,125 overapplied

- $4,425 underapplied

- $6,125 underapplied

- $4,425 overapplied