PROBLEM 2: The Smith Company manufactures special purpose machines to order. Because the products are tailored for the customers' preference, completed units are automatically sold to gain 20% profit on billed price. On 1/1/2017 there were two jobs in process, 405 and 406. The following costs were applied to them in 2016: Direct material Direct labor Overhead Total Job 405 P 5,000 Job 406 P 8,000 4,000 3,000 4,400 3.300 P13.400 P14.300 During January of 2017, the following transactions took place: Raw material costing P40,000 was purchased on account. Jobs #407, 408, and 409 were started and the following costs were applied to them: Job Job 408 Job 407 409 Direct materials P10,00 P P3,000 0 7,000 Direct labor 5,000 6,000 4,000 Job P405 and Job # 406 were completed after incurring additional direct labor costs of P2,000 and P4,000, respectively. Job 408 is also completed on January. Wages paid to production employees during January totaled P25,000. Depreciation of factory equipment for the month of January totaled P10,000. Utilities bills (where 30% of the utilities are related to office, while the remaining can be attributed to the factory) in the amount of P10,000 were paid for December 2016 operations. Supplies costing P2,000 were used. Only 40% is used by the factory, while the 60% is used for promotional activities (flyers, etc.). Office rent totaling P5,000 were billed for January operations. Miscellaneous overhead expenses totaled P13,300 for January. Any over- or underapplied overhead is considered material for the company. REQUIRED: 1. How much is the total manufacturing costs for January? 2. Give the entry to record the closing of over-underapplied overhead for the period. 3. How much is the adjusted ending Work-in-Process Inventory? 4. How much is the Net income for January?