During the year, Paul Company used a predetermined overhead rate of $3.50 per direct labour hour, based on an estimate of 22,000 direct labour hours to be worked during the year. Actual overhead cost and activity during the year were: Actual manufacturing overhead cost incurred $90,000 Actual direct labour hours worked 25,000 What was the under- or overapplied overhead for the year? $13,000 underapplied. $10,500 overapplied. $2,500 overapplied. $2,500 underapplied. The Milo Company's records for May contain the following information: Actual direct labour hours 9,000 hours Actual direct labour cost $47,000 Direct material purchased $16,000 Direct material used $14,000 Cost of goods sold $100,000 Overapplied overhead $5,000 Ending inventories: Raw materials $30,000 Work in process 50,000 Finished goods 70,000 The company uses a predetermined overhead rate of $5.00 per direct labour hour to apply manufacturing overhead to jobs. What was the actual overhead cost incurred during the month