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Normal annual capacity for the MN Company is 36,000 machine hours, with fixed overhead budgeted as 16,920 and an estimated variable factory overhead rate of $2.10 per hour. During October, actual production required 2,700 machine hours, with a total factory overhead of $7,400.
Required:
Problem 1: Compute (1) The applied factory overhead and (2) the over-or under applied amount for October
Problem 2: Define process costing, discuss normal and abnormal loss?
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