Taylor Company uses normal costing. It allocates manufacturing overhead costs using a budgeted rate per machine-hour. The following data are available for 2017:

Budgeted manufacturing overhead costs.................................$3,800,000

Budgeted machine-hours........................................................200,000

Actual manufacturing overhead costs.....................................$3,660,000

Actual machine-hours............................................................196,000

Required

1. Calculate the budgeted manufacturing overhead rate.

2. Calculate the manufacturing overhead allocated during 2017.

3. Calculate the amount of under- or over allocated manufacturing overhead. Why do Taylor's managers need to calculate this amount?