Red Raider Company uses a plantwide overhead rate with direct labor hours as the allocation base. Next year, 400,000 units are expected to be produced requiring 0.9 direct-labor hours each. How much overhead will be assigned to each unit produced given the following estimated amounts?Estimated:Department 1Department 2Manufacturing overhead costs$2,530,000 $2,752,000 Direct labor hours 168,000DLH 110,000DLHMachine hours 30,000MH 8,000MH
A. $17.10 per unit
B. $19.00 per unit
C. $125.10 per unit
D. $139.00 per unit
E. None of the choices
Answer: A
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