Kimble Company applies overhead on the basis of machine hours. Given the following data, compute overhead applied and the under-or overapplication of overhead for the period:
Estimated annual overhead cost $1,200,000
Actual annual overhead cost $1,145,000
Estimated machine hours 300,000
Actual machine hours 280,000
A) $1,120,000 applied and $25,000 overapplied
B) $1,200,000 applied and $25,000 overapplied
C) $1,120,000 applied and $25,000 underapplied
D) $1,145,000 applied and neither under- nor overapplied