Bolander Corporation uses a job-order costing system with a single plantwide predetermined overhead rate based on machine-hours. The company based its predetermined overhead rate for the current year on the following data:Total machine-hours70,000Total fixed manufacturing overhead cost$294,000Variable manufacturing overhead per machine-hour$2.30Recently, Job M825 was completed with the following characteristics:Number of units in the job20Total machine-hours80Direct materials$665Direct labor cost$1,840The predetermined overhead rate is closest to:
A. $6.50 per machine-hour
B. $4.20 per machine-hour
C. $2.30 per machine-hour
D. $8.80 per machine-hour
Answer: A
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