The Xiang Plant Has Two Categories of Overhead: Maintenance and Inspection

Multiple Choice

The Xiang plant has two categories of overhead: maintenance and inspection. Costs expected for these categories for the coming year are as follows: The plant currently applies overhead using direct labour hours and expected capacity of 50,000 direct labour hours. The following data have been assembled for use in developing a bid for a proposed job:
Total expected machine hours for all jobs during the year is 25,000, and the total expected number of inspections is 1,500.
Using direct labour hours to assign overhead, the total cost of the potential job would be

A) £2,500.
B) £5,500.
C) £4,000.
D) £4,500.