Stone Cliff Company Manufactures Custom-Order Furniture

Stone Cliff Company manufactures custom-order furniture.During 2016,actual manufacturing overhead totaled $720,000.Based on the 2016 results,and projected production for 2017,management prepared the 2017 budget and estimated that manufacturing overhead would total $800,000.The estimated number of direct labor hours for 2017 is 500,000,and the estimated amount of direct labor cost is $1,000,000.The company plans to use direct labor hours as the basis to allocate overhead to jobs.During May and June 2017,employees worked on the following four jobs: What is the predetermined overhead rate that Stone Cliff will use to allocate overhead during 2017?

A) $.80 per direct labor hour.
B) $1.60 per direct labor hour.
C) $1.44 per direct labor hour.
D) $.72 per direct labor hour.