The following information relates to Beautiful Designs Pty Ltd for the year just ended:

Budgeted direct labour cost: 80000 hours @ $22 per hour

Actual direct labour cost: 78000 hours @ $25 per hour

Budgeted manufacturing overhead: $1048000

Actual manufacturing overhead:

Depreciation: $256000

Property taxes: 19000

Indirect labour: 88000

Supervisory salaries: 210000

Electricity: 48000

Insurance: 25000

Factory rent: 290000

Indirect material (see data below): 64000

Indirect material:

Beginning inventory, 1 January: $60000

Purchases: 84000

Ending inventory, 31 December: 80000

Required:

1. Calculate the firm's predetermined overhead rate, which was based on direct labour hours.
2. Calculate the over-applied or under-applied overhead for the year.
3. Prepare journal entry to close the manufacturing overhead account to cost of goods sold.
4. What caused the over-applied or under-applied overhead?