Wendy Co. uses direct method in distributing service department costs to producing departments. Costs of Department S1 are distributed on the basis of number of employees, while costs of Department S2 are distributed on the basis of machine hours. The allocation bases used in calculating predetermined overhead rates are machine hours in Department P1 and direct labor hours in Department P2. Budgeted Overhead Number of employees Machine hours Direct labor hours Producing Departments S1 Service departments P1 P410,000 90 P2 S2 P304,000 P100,000 P50,000 210 20 28 64,000 16,000 35,000 100,000 Cost and related data pertaining to Job No. 437: Department P1 Materials costs Direct labor @P50 Machine hours P90 1 3 Department P2 Materials cost P40 Direct labor @P25 2 Machine hours 1