A manufacturer of industrial equipment has a standard costing system based on standard direct labor-hours (DLHs) as the measure of activity. Data from the company's flexible budget for manufacturing overhead are given below: Level of activity 2,500DLHs Overhead costs at the denominator activity level: Variable overhead cost$8,500 Fixed overhead cost$34,625 The following data pertain to operations for the most recent period: Actual hours 2,600DLHs Standard hours allowed for the actual output 2,592DLHs Actual total variable manufacturing overhead cost$9,100 Actual total fixed manufacturing overhead cost$35,025 What is the predetermined overhead rate to the nearest cent?
A. $17.65.
B. $16.59.
C. $17.25.
D. $16.97.
Answer: C
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