Calculate and Use Overhead Rate

Selected data for the consulting department of Kingman Consulting Inc., follow:

Estimated consulting overhead cost for the year	$558,000
Estimated direct labor cost for the year (@ $9/hr.)	324,000
Actual consulting overhead cost for May	29,000
Actual direct labor cost for May (2,400 hours)	22,000

Assuming that direct labor hours is the basis for applying consulting overhead,

a. Calculate the predetermined overhead rate per direct labor hour

b. Prepare a journal entry that applies consulting overhead for May.

General Journal
Description	Debit	Credit
work in process inventory	Answer	Answer
consulting overhead	Answer	Answer

c. By what amount is consulting overhead over-or under-applied in May?