Novus 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 ........................................................... $1,257,500
Shop direct labor ......................................................... 550,000
Shop and repair equipment depreciation ............................... 91,000
Shop supervisor salaries ................................................ 250,000
Shop property taxes ...................................................... 40,000
Shop supplies .............................................................. 15,000
Advertising expense ...................................................... 75,000
Administrative office salaries .......................................... 175,000
Administrative office depreciation expense ........................... 12,500
Total costs and expenses ............................................ $ 2,466,000
The average shop direct labor rate is $25 per hour. Determine the predetermined shop overhead rate per direct labor hour.