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Sundance Solar Company operates two factories. The company applies factory overhead to jobs on the basis of machine hours in Factory 1 and on the

  1. Sundance Solar Company operates two factories. The company applies factory overhead to jobs on the basis of machine hours in Factory 1 and on the basis of direct labor hours in Factory 2. Estimated factory overhead costs, direct labor hours, and machine hours are as follows:

    Factory 1 Factory 2
    Estimated factory overhead cost for fiscal
    year beginning March 1 $530,640 $774,700
    Estimated direct labor hours for year 12,700
    Estimated machine hours for year 24,120
    Actual factory overhead costs for March $42,390 $66,760
    Actual direct labor hours for March 1,140
    Actual machine hours for March 1,880

    a. Determine the factory overhead rate for Factory 1. $ per machine hour

    b. Determine the factory overhead rate for Factory 2. $ per direct labor hour

    c. Journalize the entries to apply factory overhead to production in each factory for March.

    Factory 1
    Factory 2

    d. Determine the balances of the factory overhead accounts for each factory as of March 31, and indicate whether the amounts represent overapplied factory overhead or underapplied factory overhead.

    Factory 1 $
    Factory 2 $

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