Sophie Company has decided that direct labor hours is a good basis on which to apply overhead to production. The following data are for the most recent year.

• Budgeted number of direct labor hours worked = 20,000 hours
• Budgeted amount of manufacturing overhead = $100,000
• Actual number of direct labor hours worked = 25,000 hours
• Actual amount of manufacturing overhead = $115,000

What is Sophie Companys PREDETERMINED OVERHEAD RATE?

• $4.00 per hour
• $4.60 per hour
• $5.75 per hour
• $5.00 per hour
• $4.50 per hour