Indicate how the predetermined overhead rate is determined between under- and overapplied manufacturing overhead. Student Instructions: Pure Decorating uses a job order cost 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 $920,000 Actual overhead $942,800 Estimated decorator hours 40,000 Actual decorator hours 40,500 The company uses Operating Overhead in place of Manufacturing Overhead. Instructions: 1. Compute the predetermined overhead rate. 2. Prepare the entry to apply the overhead for the year. 3. Determine whether the overhead was under-or overapplied and by how much.