Chnstopher's Custom Cabinet Company uses a job order cost system wth overhead applied as a percentage of direct labor casts. Irventory balances at the beginning of the current year follow.

$\backslash$table$[[$Raw Materials Inventory,$15,600],[$Work In Process Inventory,$7,090],[$Finished Goods Inventory,$20,709]]$

The following transactions occurred during January:

a$.$ Purchased materials on account for $$27,700.$

b$.$ Issued materlals to production totaling $$21,400,90$ percent of which was traced to specific jobs and the remainder of which was treated as Indirect materials.

c$.$ Payroll costs totaling $$16,500$ were recorded as follows:

$$11,000$ for assembly workers

$$1,300$ for factory supemision

$$1,400$ for administrative personnel

$$2800$ for sales commissions

d$.$ Recorded depreciation: $$4,200$ for factory machines, $$1,100$ for the copler used in the administrative office.

e$.$ Recorded $$1,200$ of explred insurance. Forty percent was Insurance on the manufacturing facility, with the remainder classified as an administrative expense.

f$.$ Paid $$6,200$ in other factory costs in cash.

g$.$ Applied manufacturing overhead at a rate of $200$ percent of direct labor cost

h$.$ Completed all jobs but one; the job cost sheet for the uncompleted job shows $$2,600$ for direct materlak, $$2,000$ for direct labor. and $$4,000$ for applied overhead.

L Sold jobs costing $$50,700.$ The revenue earned on these Jobs was $$65,910.$

Required:

Set up T$-$accounts, record the beginning balances, post the January transactions, and compute the final balance for the following accounts:

a$.$ Raw Materlals Inventory.

b$.$ Work in Process Inventory.

c$.$ Finished Goods Inventory.

d$.$ Cost of Goods Sold.

e$.$ Manufacturing Overhead.

f$.$ Selling. General, and Administrative Expenses.

g$.$ Sales Revenue.

Determine how much gross profit the company would report during the month of January before any adjustment is made for the overhead balance.

Determine the amount of over$-$or underapplled overhead.

Compute adjusted gross profit assuming that any over$-$or underapplied overhead balance is adjusted directly to Cost of Goods Sold.