Lynwood, Inc produces two different products (Product A and Product X) using two

Question

Lynwood, Inc produces two different products (Product A and Product X) using two differen activity driver, and I t activities: Machining, which uses machine hours as an batches as an activity driver. The activity rate for Machining is $130 per machine hour, and the n, which uses number of activity rate for Inspection is $580 per batch. The activity drivers are used as follows Product A Product x Total Machine hours Number of batches 1,900 49 3,100 18 5,000 67 What is the amount of Inspection cost assigned to Product A? O $247,000 O $38,860 O $28,420 O $10.440 Type here to

Explanation / Answer

The amount of Inspection cost assigned to Product A = 49 batches * $580 per batch

= $28,420

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