West Company Estimates That Overhead Costs for the Next Year

Multiple Choice

West Company estimates that overhead costs for the next year will be $5,240,000 for indirect labor and $550,000 for factory utilities.The company uses machine hours as its overhead allocation base.If 150,000 machine hours are planned for this next year,what is the company's plantwide overhead rate?

A) $0.0259 per machine hour.
B) $34.93 per machine hour.
C) $38.60 per machine hour.
D) $3.67 per machine hour.
E) $0.2727 per machine hour.