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Lufthansa, Inc. uses two different carriers (Airbus and Boeing) and allocated costs with two different activities: Machining, which uses machine hours as an activity driver,
Lufthansa, Inc. uses two different carriers (Airbus and Boeing) and allocated costs with two different activities: Machining, which uses machine hours as an activity driver, and Inspection, which uses number of round trips as an activity driver. The activity rate for Machining is $150 per machine hour, and the activity rate for Inspection is $560 per batch. The activity drivers are used as follows: Airbus 1,800 Machine hours Number of round trips Boeing 3,000 21 Total 4,800 74 53 What is the amount of Inspection cost assigned to Airbus? Multiple Choice O $11,760 $41,440 $270,000 O $29,680
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