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Lynwood, Inc. produces two different products (Product A and Product X) using two different activities: Machining, which uses machine hours as an activity driver, and
Lynwood, Inc. produces two different products (Product A and Product X) 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 activity rate for Machining is $130 per machine hour, and the activity rate for inspection is $580 per batch. The activity drivers are used as follows: Machine hours Number of batches Product A Product X 1,500 3,900 47 Total 5,400 72 25 What is the amount of inspection cost assigned to Product X? Multiple Choice $195,000 $14,500 $41,760 $27,260
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