Media, Inc., an advertising agency, applies overhead to jobs on the basis of direct professional labor hours. Overhead was estimated to be $152,000, direct professional labor hours were estimated to be 19,000, and direct professional labor cost was projected to be $285,000.
During the year, Media incurred actual overhead costs of $149,300, actual direct professional labor hours of 18,500, and actual direct labor cost of $279,000.
By year-end, the firm's overhead was:
a)$1,300 underapplied.
b)$1,300 overapplied.
c)$2,700 underapplied.
d)$2,700 overapplied.
e)$4,000 underapplied.
