Molinas, Inc

Multiple Choice

Molinas, Inc., manufactures and sells two products: Product G1 and Product S8. Data concerning the expected production of each product and the expected total direct labor-hours (DLHs) required to produce that output appear below: The company is considering adopting an activity-based costing system with the following activity cost pools, activity measures, and expected activity: If the company allocates all of its overhead based on direct labor-hours using its traditional costing method, the predetermined overhead rate would be closest to:

A) $85.99 per DLH
B) $20.98 per DLH
C) $97.94 per DLH
D) $79.32 per DLH