During the year ended 30 June 2016, Fast Fones Industries Pty Ltd incurred the following costs.

Direct labour Direct material Factory overhead

$751 200 2 855 600 6 853 440

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 $841 600 included $25 600 of direct labour costs, determine the inventory’s material and overhead costs.