Diemer, Inc., manufactures and sells two products: Product N4 and Product R7. Data concerning the expected production of each product and the expected total direct labor-hours (DLHs) required to produce that output appear below:

	Expected Production	Direct Labor-Hours Per Unit	Total Direct Labor-Hours
Product N4	200	9.0	1,800
Product R7	900	8.0	7,200
Total direct labor-hours			9,000

The company is considering adopting an activity-based costing system with the following activity cost pools, activity measures, and expected activity:

		Estimated	Expected Activity
Activity Cost Pools	Activity Measures	Overhead Cost	Product N4	Product R7	Total
Labor-related	DLHs	$357,120	1,800	7,200	9,000
Production orders	orders	20,797	400	300	700
General factory	MHs	358,425	3,800	3,700	7,500
		$736,342

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.	$39.68 per DLH
	b.	$81.82 per DLH
	c.	$29.71 per DLH
	d.	$47.79 per DLH