Simplex Company has the following estimated costs for next year:

Simplex estimates that 10,000 direct labor and 16,000 machine hours will be worked during the year. If overhead is applied on the basis of machine hours, what will be the overhead rate per hour?
 

Direct materials Direct labour Sales commissions Salary of production supervisor Indirect materials Advertising expense Rent on factory equipment $15,000 $55,000 $75,000 $35,000 $5,000 $11,000 $16,000