The Managerial Accountant at Change Organization Needs to Determine the Total

The managerial accountant at Change Organization needs to determine the total indirect Research and Development (R&D) cost associated with a new machine.The manager revealed total revenues were $4,000,000;and reported that the only prevention cost to allocate were 20,000 hours assigned to R&D at $35 per hour.The manager's report indicated that the there were no direct costs associated with the machine because there were no resources assigned to the management of quality of the machines.
Required:
Compute the total cost and the percent of revenues associated with the Research and Development at Change Organization.

A) $500,000 total cost;15.5% of revenues
B) $600,000 total cost;16.5% of revenues
C) $700,000.total cost;17.5% of revenues
D) $800,000 total cost;18.5% of revenues
E) $900,000 total cost;19.5 % of revenues