Exercise 16-13 Tombert Decorating uses a job order cost system to collect the costs of its interior decorating business. Each clients 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	$1,000,000
Actual overhead	$1,024,800
Estimated decorator hours	40,000
Actual decorator hours	39,800

The company uses Operating Overhead in place of Manufacturing Overhead.

Compute the predetermined overhead rate. (Round answer to 2 decimal places, e.g. 25.57.)

Predetermined overhead rate

$

per decorator hour

Prepare the entry to apply the overhead for the year. (Credit account titles are automatically indented when amount is entered. Do not indent manually. Round answers to 0 decimal place, e.g. 55.)

Account Titles and Explanation	Debit	Credit

Determine whether the overhead was under- or overapplied and by how much.

Overhead

$