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Gemstone LLC produces kayaks and has recently adopted activity based costing. Information on the following topics was gathered concerning the purchasing department: writing purchase orders for plywood, ordering key parts, number of plywood purchase orders written, number of key parts orders placed. The total overhead costs in purchasing is $600,000 of which $400,000 is associated with writing purchase orders for plywood. If these are 40,000 purchase orders written for plywood, the overhead application rate for writing plywood purchase orders is:
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