Question: 1. In a job order cost accounting system, why does the Factory Overhead account usually have an overapplied or underapplied balance at period-end?

2. When the Factory Overhead account has a debit balance at period-end, does this reflect overapplied or underapplied overhead?

3. At the beginning of a period a company predicts total direct materials costs of $175,000 and total overhead costs of $218,750. If the company uses direct materials costs as its activity base to allocate overhead, what is the predetermined overhead rate it should use during the period?