The following information was reported by Fye Company relating to its first year of operations. Note that Fyfe has only identified direct labor and direct materials as direct costs.

Item

Advertising Expenditures

Depreciation on Factory Equipment

Direct Labor

Direct Materials

Factory Supplies

Head Office General Expenditures

Head Office Salaries

Heating in Factory

Income Taxes

Factory Equipment Repair and Maintenance

Production Supervisor Wages

Rent for Factory

Office Supplies

Sales Expenditures

Total

Expected Cost

$$156,000$

$540,000$

$900,000$

$1,200,000$

$102,000$

$340,000$

$340,000$

$125,000$

$2,500,000$

$102,000$

$123,000$

$950,000$

$124,000$

$432,000$

$$7,934,000$

Actual Cost

$$144,000$

$570,000$

$925,000$

$1,100,000$

$107,000$

$325,000$

$345,000$

$145,000$

$2,450,000$

$98,000$

$128,000$

$945,000$

$129,000$

$456,000$

$$7,867,000$

Fyfe Company allocates manufacturing overhead using a predetermined overhead rate. Fyfe uses direct labor hours as an allocation base and incurs $36,000$ direct labor hours. Required

a$)$ What is the total estimated manufacturing overhead cost?

Item

Expected

Cost

b$)$ What is the predetermined overhead rate?

c$)$ If the hourly rate for direct labor is $$25,$ what is the manufacturing overhead applied to production?

d$)$ What is the over or underallocated manufacturing overhead for this year? Assume the wage rate is still $$25/$hr$.$