The management of Mcneff Corporation would like to investigate the possibility of basing its predetermined overhead rate on activity at capacity. The company's controller has provided an example to illustrate how this new system would work. In this example, the allocation base is machine-hours. 
If the company bases its predetermined overhead rate on capacity, by how much was manufacturing overhead underapplied or overapplied?
Definitions:
Supply Curve
The supply curve is a graphical representation showing the relationship between the price of a good and the quantity supplied by producers.
Sugar Beets
A plant whose root contains a high concentration of sucrose and which is grown commercially for sugar production.
Refined
Improved or made more elegant or sophisticated through careful modification.
Supply Curve
A graphical representation of the relationship between the price of a good and the quantity supplied, typically upward sloping.
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