Cottonwood, Inc. produces two different products (Standard and Luxury) 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 $161,000, while the cost of Inspection is $40,000. Standard uses 30% of total machine hours and 65% of total batches. What is the total activity cost assigned to Luxury?

Multiple Choice

• $74,300

• $112,700

• $126,700

• $14,000