Savallas Company is highly automated and uses computers to control manufacturing operations. The company uses a job-order costing system and applies manufacturing overhead cost to products on the basis of computer-hours. The following estimates were used in preparing the predetermined overhead rate at the beginning of the year:

Computer-hours		80,000
Fixed manufacturing overhead cost	$	1,277,000
Variable manufacturing overhead per computer-hour	$	4.00

During the year, a severe economic recession resulted in cutting back production and a buildup of inventory in the companys warehouse. The companys cost records revealed the following actual cost and operating data for the year:

Computer-hours		50,000
Manufacturing overhead cost	$	1,078,000
Inventories at year-end:
Raw materials	$	420,000
Work in process	$	190,000
Finished goods	$	1,020,000
Cost of goods sold	$	2,790,000

Required:

1. Compute the companys predetermined overhead rate for the year. (Round predetermined overhead rate to 2 decimal places.)

2. Compute the underapplied or overapplied overhead for the year. (Round predetermined overhead rate to 2 decimal places.)