Exercise 3-4 Underapplied and Overapplied Overhead [LO3-4] Osborn Manufacturing uses a predetermined overhead rate of $20 20 per direct labor-hour. This predetermined rate was based on a cost formula that estimates $282.800 of total manufacturing overhead for an estimated activity level of 14,000 direct labor-hours The company actually incurred $279.000 of manufacturing overhead and 13.500 direct iabor-hours during the period. Required: 1. Determine the amount of underapplied or overappied manufacturtng overhead for the period 2 Assume that the company's underapplied or overappililed overhead is closed to Cost of Goods Sold. Would the journal entry to dispose of the underapplied or overapplied overhead Increase or decrease the company's gross margin? By how much? 1 Manufacturing overmead 2. The gross margin would by by