MMF company uses a normal costing system in which factory overhead is applied on the basis of direct labor costs. Budgeted factory overhead for the year was $680,000, and management budgeted $322,000 of direct labor costs. During the year, the company incurred the following actual costs.

	Direct materials used	$389,000
	Direct labor	318,000
	Factory overhead	653,400

The January 1 balances of inventory accounts are shown below.

	Materials all direct	$62,800
	Work-in-process	41,000
	Finished goods	25,600

The December 31 balances of these inventory accounts were ten percent lower than the balances at the beginning of the year. The predetermined factory overhead rate is ----------------- :

• 211% of direct labor costs.

• 203% of direct labor costs.

• 214% of direct labor costs.

• 213% of direct labor costs.

• 205% of direct labor costs.