Western Company allocates $10.00 overhead to each unit produced. The company uses a plantwide overhead rate with machine hours as the allocation base. Given the amounts below, how many machine hours does the company expect in department 2?
Estimated: Department 1 Department 2
Manufacturing overhead costs $250,000 $150,000
Direct labor hours 8,000 DLH 12,000 DLH
Machine hours 15,000 MH? MH
a. 33,000 MH
b. 137,500 MH
c. 82,500 MH
d. 25,000 MH
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