Reference no: EM132649757

On April 1, Peter Senen Company had the following balances in the inventory accounts:

Materials Inventory P12,450

Work in process Inventory 22,605

Finished Goods Inventory 4,600

Work in process inventory is made up of three jobs with the following costs:

Job 114 Job 115 Job 116

Direct Materials P3,650 P1,900 P3,650

Direct labor 1,800 1,560 4.300

Applied overhead 1,350 1,170 3,225

During April, Peter Senen experienced the transactions listed below:

1. Materials purchased on account, P26,000
2. Materials requisitioned: Job 114, P16,500; Job 115, P12,200 and Job 116, P5,000
3. Direct labor hours worked: Job 114, 350 hours at P12 per hour; Job 115, 280 hours at P15 per hour and Job 116, 150 hours at P20 per hour.
4. Overhead is applied on the basis of direct labor cost
5. Actual overhead was P8,718
6. Job 115 was completed and transferred to the finished goods warehouse. Job 115 was shipped, and the customer was billed for 120% of the cost.

Question 1: What is the predetermined overhead rate based on direct labor cost?