Reference no: EM133106767

Question - Street Runner 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 $740,000

Shop direct labor 500,000

Shop and repair equipment depreciation 40,000

Shop supervisor salaries 133,000

Shop property taxes 22,000

Shop supplies 10,000

Advertising expense 20,000

Administrative office salaries 71,400

Administrative office depreciation expense 6,000

Total costs and expenses $1,542,400

The average shop direct labor rate is $20 per hour.

Required - Determine the predetermined shop overhead rate per direct labor hour. Round to the nearest cent.