Hancock Manufacturing allocates overhead to production on the basis of direct labor costs. At the beginning of the year, Hancock estimated total overhead of $322,000; materials of $420,000 and direct labor of $230,000. During the year Hancock incurred $428,000 in materials costs, $415,600 in overhead costs and $234,000 in direct labor costs. Compute the overhead application rate. 178%. 77%. 71%. 140%. 182%.