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Easy Decorating uses a job-order costing 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 $936,100Actual overhead $964,000Estimated decorator hours 40,700Actual decorator hours 41,490
Question 1: Calculate the predetermined overhead rate.
Question 2: Prepare the entry to apply the overhead for the year. (Credit account titles are automatically indented when the amount is entered. Do not indent manually.)
Question 3: Determine whether the overhead was under- or over-applied and by how much.
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