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A company estimates that total overhead will be $300,000. Of the overhead, $100,000 consists of machine-related costs and the other $200,000 is direct labor-related costs.

A company estimates that total overhead will be $300,000. Of the overhead, $100,000 consists of machine-related costs and the other $200,000 is direct labor-related costs. They expect to work 20,000 labor hours and use 4,000 machine hours. Assuming the company uses two-stage cost allocation, the machine-related overhead rate is $ per machine hour.

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