Question - Venkat Manufacturing forecasts that total overhead for the current year will be $12,000,000 and that total machine hours will be 200,000 hours. Year to date, the actual overhead is $8,000,000 and the actual machine hours are 100,000 hours. If Venkat Manufacturing uses a predetermined overhead rate based on machine hours for applying overhead, what is that overhead rate?
a. $80 per machine hour
b. $120 per machine hour
c. $40 per machine hour
d. $60 per machine hour