Managerial Accounting: E15-13 Pure Decorating uses a job order cost system to collect

Managerial Accounting 
E15-13 
Pure Decorating uses a job order cost system to collect the costs of its interior decorating business. Each client's consultation is treated as a separate job. Overhead is applied to each job based on the number of decorator hours incurred. Listed below are data for the current year. 
Estimated overhead 920,000 
Actual overhead 942,800 
Estimated decrator hours 40,000 
Actual decorator hours 40,500 
The company uses Operating Overhead in place of Manufacturing Overhead. 

Instructions: 
a. Compute the predetermined overhead rate. 
b. Prepare the entry to apply the overhead for the year. 
c. Determine whether the overhead was under- or overapplied and by how much.
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