The Following Estimated Overhead Cost Information Is Available for Michaels

Multiple Choice

The following estimated overhead cost information is available for Michaels Company for the most recent year.

The company anticipates the following activity levels during the year: 5,000 purchase orders issued;7,000 shipments received;80,000 machine setups performed;and 9,000 inspections conducted.
What is the overhead rate for the quality control activity?

A) $10
B) $80
C) $7
D) $4
E) None of the answer choices is correct.