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Bervine, Inc. produces two different products (bompers and woobles) using two different activities: Machining, which uses machine hours as an activity driver, and Inspection, which

Bervine, Inc. produces two different products (bompers and woobles) using two different activities: Machining, which uses machine hours as an activity driver, and Inspection, which uses number of batches as an activity driver. The cost of Machining is $500,000, while the cost of Inspection is $30,000. Usage of the activity drivers are as follows:

Bompers Woobles Total
Machine hours 1,000 3,000 4,000
Number of batches 45 15 60

What is the activity rate for Inspection?

Select one:

a.

$125 per batch

b.

$500 per batch

c.

$667 per batch

d.

$2,000 per batch

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