A business uses absorption costing and applies a mark-up of 50% when setting selling prices.
Each unit of product X has a direct cost of $\$ 60$ and a selling price of $\$ 150$ and requires two hours of machine time.
What is the overhead absorption rate per machine hour?
1 )
$\$ 7.50$
2 )
$\$ 15.00$
$\$ 20.00$
4 )
$\$ 40.00$
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