Question: The Dunrobin law firm allocates overhead to different clients based on hours of work performed by Mr. Dunrobin. At the start of the year, Mr.

The Dunrobin law firm allocates overhead to different clients based on hours of work performed by Mr. Dunrobin. At the start of the year, Mr. Dunrobin estimates that the total overhead of the coming year will be $$100,000.$ He also estimates that he will perform 2,000 hours of work for clients. During the year, he works 2,100 hours for clients and incurs $$110,000$ of overhead.

a. How much overhead is allocated?

b. What is the over- or under-absorbed overhead?

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