Carera Corporation uses a predetermined overhead rate of $23.10 per direct labour-hour. This predetermined rate was based on 12,000 estimated direct labour-hours and $277,200 of estimated total manufacturing overhead. The company incurred actual total manufacturing overhead costs of $296,000 and 12,600 total direct labour-hours during the period.

Required: 1. Determine the amount of manufacturing overhead applied to units of product during the period as well as the amount of over- or underapplied overhead for the period.

2. Prepare the journal entry to dispose of over- or underapplied overhead.

Note: Enter debits before credits.