EX 16-10 Predetermined factory overhead rate Obj. 2 Exotic Engine Shop uses a job order cost system to determine the cost of performing engine repair work. Estimated costs and expenses for the coming period are as follows: Engine parts Shop direct labor Shop and repair equipment depreciation Shop supervisor salaries Shop property taxes Shop supplies Advertising expense Administrative office salaries Administrative office depreciation expense Total costs and expenses $ 380,000 1,872,000 62,500 240,000 36,940 10,000 28,000 150,000 8,000 $2,787,440 The average shop direct labor rate is $37.50 per hour. Determine the predetermined shop overhead rate per direct labor hour