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Question - Kayak Company uses a job order costing system and allocates its overhead on the basis of direct labor costs. Kayak Company's production costs for the year were: direct labor, $30,000; direct materials, $50,000; and factory overhead applied $6,000. Determine the overhead application rate?
a. 500.0%.
b. 5.0%.
c. 16.7%.
d. 2.0%.
e. 20.0%.
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