Tiffany charges manufacturing overhead to products by using a predetermined application rate, computed on the basis of labor hours. The following data pertain to the current year:

Budgeted manufacturing overhead: $ 1,800,000

Actual manufacturing overhead: $ 1,813,500

Budgeted labor hours: 90,000

Actual labor hours: 92,200

Which of the following choices is the correct status of manufacturing overhead at year-end?

Overapplied by $13,500.

Underapplied by $13,500.

Overapplied by $30,500.

Underapplied by $30,500.

Overapplied by $44,000.