Adams Manufacturing Corporation was started with the issuance of common stock for $65,000. It purchased $7,800 of raw materials and worked on three job orders during Year 1 for which data follow. (Assume that all transactions are for cash unless otherwise indicated.)

	Direct Raw Materials Used				Direct Labor
Job 1		$	1,400			$	1,900
Job 2			2,300				3,900
Job 3			3,100				1,900
Total		$	6,800			$	7,700

Factory overhead is applied using a predetermined overhead rate of $0.50 per direct labor dollar. Jobs 2 and 3 were completed during the period and Job 3 was sold for $9,850 cash. Adams paid $600 for selling and administrative expenses. Actual factory overhead was $4,350.

Required

1. a. Record the preceding events in a horizontal statements model. The first event for Year 1 has been recorded as an example.

2. c. Record the closing entry for over- or underapplied manufacturing overhead in the horizontal statements model, assuming that the amount is insignificant.