During the year ended 30 June 2025, Modern Furniture Pty Ltd incurred the following costs.

The company charges factory overhead costs to work in process inventory and finished goods inventory using an overhead application rate based on direct materials costs.
Required

(a) Determine the company’s overhead application rate.

(b) If the company’s ending finished goods inventory of \($1\) 683 200 included \($51\) 200 of direct labour costs, determine the inventory’s material and overhead costs.

Transcribed Image Text:

Direct labour Direct material Factory overhead $ 1502 400 5 711 200 13 706 880