Rovet Company uses normal costing. It allocates manufacturing overhead costs using a budgeted rate per machine- hour. The following data are available for 2012:

Budgeted manufacturing overhead costs......... $ 4,250,000

Budgeted machine- hours.............. 250,000

Actual manufacturing overhead costs .........$ 4,120,000

Actual machine- hours ................ 245,000

Required

1. Calculate the budgeted manufacturing overhead rate.

2. Calculate the manufacturing overhead allocated during 2012.

3. Why do Rovet’s managers want to calculate a budgeted manufacturing overhead rate?

4. Calculate the amount of under- or overallocated manufacturing overhead. Why do Rovet’s managers need to calculate this amount?