Applying Factory Overhead

Keenan Company estimates that total factory overhead costs will be $48,000 for the year. Direct labor hours are estimated to be 12,000.

a.For Keenan Company, determine thepredetermined factory overhead rateusing direct labor hours as the activity base. If required, round your answer to two decimal places.

$____ per direct labor hour

b.During August, Keenan Company accumulated 870 hours of direct labor costs on Job 40 and 820 hours on Job 42. Determine the amount of factory overhead applied to Jobs 40 and 42 in August. $____

c.Prepare the journal entry to apply factory overhead to both jobs in August according to the predetermined overhead rate.

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