Question 3 (Job-order costing) (10 marks) The following are independent questions. Q3 A Jay Company uses normal costing in its job-order costing system, with manufacturing oveth applied based on machine hours. You have obtained the following information but operation of the company. out the At the beginning of Year 2, the company had budgeted the following costs for the year ended December Year 2 $35,000 Direct materials used Direct manufacturing labour Accounts payable Factory equipment- Asset Sales revenues Sales commissions $200,000 $100,000 S 40,000 $900,000 $800,000 Factory Supplies Expense Amortization-Factory Equipment $40,000 Rent- Factory Indirect Labour Factory Insurance Expense $60,000 $15,000 $10,000 16,000 Hours 80,000 Machine hours During Year 2, the company had the following actual transactions: Direct materials used Direct manufacturing labour Accounts payable Factory equipment - Asset Sales revenues Sales commissions $30,000 95,000 Amortization-Factory Equipment $40,000 $65,000 $17,000 Factory Insurance Expense $10,000 15,500 Hours $140,000 Factory Supplies Expense 50,000 Rent - Factory $900,000 Indirect Labour $850,000 85,000Machine hours used Required: 1) What would be the amount of the tunder - or over applied manufacturing overhead' for the year. Indicate the amount, and if whether it is under or over applied.) Q 38 Matt Corporation uses job order costing system. For the year the manufacturing overhead is underapplied by $4,000. Prepare the journal entry to correct the underapplied manufacturing overhead, in the space provided Journal Entry Account Debit Credit