HOW TO SOLVE IT

3. Marc Inc. produces a product using standard costing system where manufacturing overhead is applied into production based on machine hours. The following information was provided by the manager for the overhead costs that should be incurred at an activity level of 15,000 machine hours and their operating results for the year Fixed manufacturing overhead $65,000 Variable manufacturing overhead 18,500 Total manufacturing overhead 83,500 Standard machine hours allowed 13,000 Actual machine hours worked 11,000 Actual variable manufacturing overhead $22,000 Actual fixed manufacturing overhead $62,000 At the end of the year the company's manufacturing overhead accounting contained applied costs of $72,280 and actual costs of $67,060 Required a. Calculate the predetermined overhead rate and calculate its variable and fixed cost elements. b. Calculate variable and fixed overhead variance c. Using the above calculations show whether the overhead account would be underapplied or overapplied