June Company estimated that it would work 5,000 machine hours and incur $15,000 in total manufacturing overhead costs for the year. They use a job-order costing system in which overhead is applied to jobs based on machine hours. During the first year of operations, they had the following selected transactions. a. Purchased materials for $25,000 on account. b. Total salaries and wages of $9,000 were paid. Of this amount, $1,000 was for administrative salaries, $7,000 was for direct labour and the remainder was for indirect labour. c. Direct materials used were $20,000. Indirect materials used were $4,000 d. Insurance costs were incurred and paid in cash: $8,000 in the factory and $6,000 in the administrative office. e. Overhead was applied. The company recorded 5,200 machine hours for the year. f. All of the jobs were completed and transferred. Required: 1. Calculate the predetermined overhead rate. (2 marks) 2. Prepare journal entries to record the above events. (18 marks) (Identify each journal entry by letter in the date column.) 3. Calculate the balance in the manufacturing overhead account, and label it as either underapplied or overapplied