The Larkspur Company sells batches of custom-made futons to customers and uses predetermined rates for fixed overhead, based on machine hours. The following data are available for last year:

Budgeted and actual fixed factory overhead cost		$	147,200
Budgeted machine hours			92,000
Actual machine hours used			102,500

		Machine
		Hours
		Used
Job 20		11,600
Job 21		16,500
Job 22		14,500
Job 23		8,600

Compute the estimated overhead allocation rate to be used for the year. (Round to 2 decimal places, e.g 15.25.)

Overhead estimated allocation rate

$

per machine hour

Determine the overhead to be allocated to Job 21.

Overhead allocated to Job 21

$

Determine total overapplied or underapplied overhead at the end of the year.

Overhead is

$

underapplied/ overapplied

Should cost of goods sold be increased or decreased at the end of the year?

Cost of goods sold should be: increased/ decreased