McKenna Collins LLP public accounting firm employs 10 full-time professionals who provide services to clients. All professional labour compensation is traced directly to clients on a per professional labour-hour basis. Any other costs are included in a single indirect-cost pool (same as overhead) and allocated to individual clients according to billable professional labour-hours. Operating costs and data for the year included the following:

	Estimated	Actual
Overhead (indirect) cost	$1,000,000	$1,200,000
Number of billable professional labour hours	40,000	50,000
Total professional compensation	750,000	750,000

Required: a. By how much, if any, was the overhead cost underapplied or overapplied? (4 Marks) b. Prepare a summary journal entry to close any underapplied or overapplied overhead cost to a Cost of Services Provided account. (2 Marks)

c. Explain qualitatively and quantitatively (in as much detail as possible) the source(s) of any underapplied or overapplied overhead cost. (4 Marks)