Rooney Corporation makes custom-order furniture to meet the needs of persons with disabilities. On January 1, 2018, the company had the following account balances: $89,000 for both cash and common stock. In 2018, Rooney worked on three jobs. The relevant direct operating costs follow:

	Direct Labor				Direct Materials
Job 1	$	4,500			$	5,000
Job 2		2,900				1,900
Job 3		9,000				4,600
Total	$	16,400			$	11,500

Rooneys predetermined manufacturing overhead rate was $.40 per direct labor dollar. Actual manufacturing overhead costs amounted to $6,300. Rooney paid cash for all costs. The company completed and delivered Jobs 1 and 2 to customers during the year. Job 3 was incomplete at the end of the year. The company sold Job 1 for $16,400 cash and Job 2 for $8,700 cash. Rooney also paid $3,900 cash for selling and administrative expenses for the year.

Rooney uses a just-in-time inventory management system. Consequently, it does not have raw materials inventory. Raw materials purchases are recorded directly in the Work in Process Inventory account.

Required

1. Record the preceding events in a horizontal statements model. The first row shows beginning balances.-

   Record the preceding events in a horizontal statements model. The first row shows beginning balances. (Enter costs of each job individually. Enter any decreases to account balances with a minus sign.)

2. Record the entry to close the amount of underapplied or overapplied overhead for the year to Cost of Goods Sold (in the expense category) in the horizontal financial statements model.-

   Record the entry to close the amount of underapplied or overapplied overhead for the year to Cost of Goods Sold (in the expense category) in the horizontal financial statements model.

3. Determine the gross margin for the year.-

   Determine the gross margin for the year.