Question - The Hatch Manufacturing Company has the following budgeted overhead cost and other data for its machining department for the month of December:

Budgeted Data:

 Indirect labor and supplies $70,000

Factory rent $19,000

Supervision $84,000

Depreciation on equipment $139,000

Cost-allocation base for overhead application Machine hours

Budgeted overhead application rate $6 per machine hour

Other Data:

Actual machine hours during December 68,000

Actual overhead cost incurred during December $439,000

Compute the total budgeted machine hours, total applied overhead cost, and indicate how any difference between the actual overhead cost incurred and applied overhead would be treated on Hatch's income statement for the month of December.