Detailed Answer
Answer (A) is correct.
Wagner’s application rate for overhead is $2.50 per machine hour
($250,000 budgeted total ÷ 100,000 estimated machine hours), and each
unit of output is estimated to require 2 machine hours (100,000 estimated
machine hours ÷ 50,000 units budgeted output). Under a standard cost
system, the amount of overhead applied during the year was therefore
$240,000 (48,000 units actual output × $2.50 per machine hour
application rate × 2 machine hours standard per unit).