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2. Gonzalez, Inc. manufactures stereo speakers in two factories; one in Vandalia, Illinois and another in Merced, California.

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Gonzalez inc. (a) = $165,000; $4,125,000/$25 (b) = $169,000; $4,225,000/$25 (c) = $110,000 underapplied; $4, 115,000 - $4,225

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