Question 3: Sonata Audio Equipment Company computes its predetermined overhead rate annually on the basis of direct labour-hours. At the beginning of the year, it estimated that its total manufacturing overhead would be $494,000 and the total direct labour would be 26,000 hours. Its actual total manufacturing overhead for the year was $483,400 and its actual total direct labour was 27,000 hours. Compute the company's predetermined overhead rate for the year, calculate the total overhead applied, and determine the amount of under- or overapplied overhead in the year. [5 Marks