Hearthstone,Inc.,a home healthcare firm,has been using a single predetermined overhead allocation rate with direct labor hours as the allocation base to allocate overhead costs.The direct labor rate is $200 per hour.Clients are billed at 190% of direct labor cost.Sofi Acosta,the president of Hearthstone,decided to develop an ABC system to more accurately allocate the indirect costs.She identified two activities related to the total indirect costs-travel and information technology (IT) support.The other relevant details are given below: The predetermined overhead allocation rate for travel will be ________.(Round your answer to the nearest cent.)
A) $46.15 per mile
B) $28.33 per mile
C) $65.38 per mile
D) $48.33 per mile
Correct Answer:
Verified
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