Chapter1 - Introduction to Managerial Accounting Morrow Company applies overhead based on direct labor hours. At the beginning of the year, Morrow estimates overhead to be $620,000, machine hours to be 180,000, and direct labor hours to be 40,000. During February, Morrow has 4,200 direct labor hours and 8,000 machine hours. 26. Refer to Figure 5-1. What is the amount of overhead applied for February? a. $65,100 b. $42,000 c. $24,000 d. $78,200 e. $66,410 27. Refer to Figure 5-1. If the actual overhead for February is $64,700, what is the overhead variance and is it overapplied or underapplied? a. $400 underapplied b. $200 overapplied c. $1,000 underapplied d. $400 overapplied e. $600 overapplied