The following budget information relates to Quality 1 Ltd for the year ended 31 December, 2018:

Manufacturing overhead $2,280,000

Direct labour cost $1,900,000

Qualitys manufacturing overhead is allocated to jobs based on direct labour cost. The company applies a policy that any under- or over-allocated overhead is adjusted to the cost of goods sold. The following are the actual data for the month of October 2018:

1. Purchases of direct materials amounted to $620,000 in which $108,000 was for Material X and $512,000 was for Material Y.

2. Material inventory balance at 1 October 2018 was $45,000. There was no completed job or work-in-progress on that day.

3. Purchases of indirect materials amounted to $200,000.

4. The following data are extracted from the job costing records:

Material requisition	Job 1207	Job 1208	Job 1209	Total
Direct material X	$60,000	$90,000	$150,000	$300,000
Direct material Y	$70,000	$210,000	$12,000	$292,000
Indirect materials				$100,000
Total material issued				$692,000
Labour costs
Direct labour	$45,000	$65,000	$60,000	$170,000
Indirect labour				$35,000
				$205,000
Miscellaneous factory				$50,000
overhead
Administration				$120,000
expenses

Job 1207 and Job 1208 were completed in the month and Job 1208 was sold for $600,000 during the month. Job 1209 was not completed as at 31 October, 2018.

Required

Calculate the total manufacturing cost for Jobs 1207, 1208 and 1209 for October 2018.

Compute the amount of under- or over-allocated manufacturing overhead.

Prepare an income statement for October 2018, showing the gross profit.

Calculate the amounts of inventories at 31 October, 2018.