Fresco Production Uses a Predetermined Overhead Rate Based Upon Direct

Multiple Choice

Fresco Production uses a predetermined overhead rate based upon direct labour hours. The firm has the following budgeted and actual data for the current year:
$$\begin{array} { l r } \text { Budgeted factory overhead cost } & \$ 12000 \\\text { Actual factory overhead cost } & \$ 13500 \\\text { Budgeted direct labour hours } & 2000 \\\text { Actual direct labour hours } & 2400\end{array}$$
What was the amount of underapplied or overapplied overhead for the year?

A) $1 500 overapplied
B) $1 500 underapplied
C) $900 underapplied
D) $900 overapplied