Supreme Videos, Inc., produces short musical videos for sale to retail outlets. The companys balance sheet accounts as of January 1, the beginning of its fiscal year, are given below:

Supreme Videos, Inc. Balance Sheet January 1
Assets
Current assets:
Cash		$80,000
Accounts receivable		119,000
Inventories:
Raw materials (film, costumes)	$47,000
Videos in process	20,000
Finished videos awaiting sale	98,000	165,000
Prepaid insurance		12,400
Total current assets		376,400
Studio and equipment	764,000
Less accumulated depreciation	227,000	537,000
Total assets		$913,400
Liabilities and Stockholders' Equity
Accounts payable		$120,400
Capital stock	$506,000
Retained earnings	287,000	793,000
Total liabilities and stockholders' equity		$913,400

Because the videos differ in length and in complexity of production, the company uses a job-order costing system to determine the cost of each video produced. Studio (manufacturing) overhead is charged to videos on the basis of camera-hours of activity. The companys predetermined overhead rate for the year is based on a cost formula that estimated $230,000 in manufacturing overhead for an estimated allocation base of 5,000 camera-hours. The following transactions were recorded for the year:

a.	Film, costumes, and similar raw materials purchased on account, $202,000.
b.	Film, costumes, and other raw materials issued to production, $217,000 (85% of this material was considered direct to the videos in production, and the other 15% was considered indirect).
c.	Utility costs incurred in the production studio, $89,000.
d.	Depreciation recorded on the studio, cameras, and other equipment, $101,000. Three-fourths of this depreciation related to actual production of the videos, and the remainder related to equipment used in marketing and administration.
e.	Advertising expense incurred, $147,000.
f.	Costs for salaries and wages were incurred as follows:

Direct labor (actors and directors)	$	99,000
Indirect labor (carpenters to build sets,
costume designers, and so forth)	$	127,000
Administrative salaries	$	112,000

g.	Prepaid insurance expired during the year, $8,700 (80% related to production of videos, and 20% related to marketing and administrative activities).
h.	Miscellaneous marketing and administrative expenses incurred, $10,300.
i.	Studio (manufacturing) overhead was applied to videos in production. The company recorded 7,800 camera-hours of activity during the year.
j.	Videos that cost $567,000 to produce according to their job cost sheets were transferred to the finished videos warehouse to await sale and shipment.
k.	Sales for the year totaled $959,000 and were all on account. The total cost to produce these videos according to their job cost sheets was $617,000.
l.	Collections from customers during the year totaled $867,000.
m.	Payments to suppliers on account during the year, $517,000; payments to employees for salaries and wages, $324,000. Was the Studio (manufacturing) Overhead account underapplied or overapplied for the year?