Kelsh Company uses a predetermined overhead rate based on machine hours to apply manufacturing overhead to jobs. The company has provided the following estimated costs for next year:
Direct materials: $10,000
Direct labor: 30,000
Sales commissions: 40,000
Salary of production supervisor: 20,000
Indirect materials: 4,000
Advertising expense: 8,000
Rent on factory equipment: 10,000
Kelsh estimates that 5,000 direct labor hours and 10,000 machine hours will be worked during the year. what will be the predetermined overhead rate per hour ?