Custom Furniture uses a job order costing system and applies overhead on the basis of direct labor hours. On January 1, 2016, Job No. 20 was the only job in process. The costs incurred prior to January 1, 2016 on Job No. 20 were as follows: Direct Materials $20,000; Direct Labor $5,000; and Manufacturing overhead applied of $10,000. Raw materials inventory at January 1, 2016 consisted of 825,000. Job No. 19 was completed during 2015 at a total cost of $90,000 and is awaiting customer pick-up at January 1, 2016. During the month of January 2016, Customer Furniture began production of Jobs 21 and 22, completing Jobs 20 and 21 during January. Also, during January Job No. 19 and 20 were sold on account to customers tor $ 20,000 and $ 10,000, respectively. The following additional events occurred during the month. Purchased raw materials on account in the amount of $ 15,000. Incurred direct factory labor costs of $40,000 and indirect labor of $27,000. Wages will be paid next week. Requisitions of raw materials to work in process consisted of direct materials and $3,000 of indirect materials. Assigned direct materials and direct labor to jobs during January as follows: Incurred other manufacturing overhead costs as follows: Depreciation on factory of $39,000 and insurance on factory of $6, 700. The insurance had ben prepaid by Custom Furniture in 2015. The company uses direct labor hours as the activity to assign overhead costs to production. Calculate the predetermined overhead rate for 2016 assuming Custom Furniture estimates total manufacturing overhead during all of 2016 to be $1, 020,000 and total direct labor costs of $600,000 and total direct labor hours of 34,000. Prepare all necessary journal entries based on the information provided in the problem. Construct "T" accounts and determine the balance in Raw Materials Inventory, Work-in-Process Inventory, and Finished Goods Inventory and the end of January 2016. What is the amount of the over or under applied overhead? What was the gross profit for the month