Wall Nuts, Incorporated produces paneling that requires two processes, A and B, to complete. Oak is the best-selling type of paneling produced. Information related to the 40,000 units of oak paneling produced annually is shown in the following table:

Direct materials	$ 380,000
Direct labor
Department A (6,000 DLH $25 per DLH)	$ 150,000
Department B (35,125 DLH $16 per DLH)	$ 562,000
Machine Hours
Department A	24,000	MH
Department B	32,000	MH

Wall Nuts' total expected overhead costs and related overhead data are shown below.

	Department A		Department B
Direct labor hours	67,000	DLH	170,000	DLH
Machine hours	100,000	MH	80,000	MH
Manufacturing overhead costs	$ 450,000		$ 600,000

Use the data for Wall Nuts, Incorporated to compute departmental overhead rates based on machine hours in Department A and machine hours in Department B.

Multiple Choice

• $4.50 per MH in Department A; $4.50 per MH in Department B.

• $7.50 per MH in Department A; $7.50 per MH in Department B.

• $4.50 per MH in Department A; $7.50 per MH in Department B.

• $2.70 per MH in Department A; $6.00 per MH in Department B.

• $0.60 per MH in Department A; $0.80 per MH in Department B.