Reamer 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 $1,000 Direct labor $3,000 Sales commissions $4,000 Salary of production supervisor $2,000 Indirect materials $ 400 Advertising expense $ 800 Rent on factory equipment $1,000 Reamer estimates that 500 direct labor-hours and 1,000 machine-hours will be worked during the year. The predetermined overhead rate per hour will be: $6.80 $6.00 $3.00 $3.40 must show work