Figure 2

The following information was extracted from the accounting records of Bowater Company. The annual flexible overhead budget is expected to be $215,000 of fixed costs and $6 per machine hour. The budgeted number of machine hours for the coming year is 7,500, and 8,000 machine hours were actually used during the year.

Actual overhead costs incurred for the year:

Indirect materials $97,500

Indirect labor $60,000

Utilities $10,000

Insurance $25,000

Rent $70,000

Refer to Figure 2. Bowaters amount of over applied or under applied overhead would be (round the rate to two decimal places)