Markham Company makes two products: Basic Product and Deluxe Product. Annual production and sales are 1,600 units of Basic Product and 1,200 units of Deluxe Product. The company has traditionally used direct labor-hours as the basis for applying all manufacturing overhead to products. Basic Product requires 0.4 direct labor hours per unit and Deluxe Product requires 0.8 direct labor hours per unit. The total estimated overhead for next period is $98,935. The company is considering switching to an activity-based costing system for the purpose of computing unit product costs for external reports. The new activity-based costing system would have three overhead activity cost poolsActivity 1, Activity 2, and General Factorywith estimated overhead costs and expected activity as follows: Estimated Expected Activity Activity Cost Pool Overhead Costs Basic Product Deluxe Product Total Activity 1 $ 30,564 1,300 900 2,200 Activity 2 17,430 2,000 500 2,500 General Factory 50,941 640 960 1,600 Total $ 98,935 (Note: The General Factory costs are allocated on the basis of direct labor hours.) The predetermined overhead rate under the traditional costing system is closest to: Multiple Choice $61.83. $6.97. $31.84. $13.89.