Racquet King Corporation manufactures titanium and aluminum tennis racquets. Racquet King's total overhead costs consist of assembly costs and inspection costs. The following information is available: Cost Titanium Aluminum Total Cost Assembly 500 mach. hours 500 mach. hours $30,000 Inspections 350 150 $50,000 2,100 labor hours 1,900 labor hours Racquet King is considering switching from one overhead rate based on labor hours to activity-based costing. Using activity-based costing, how much inspection cost is assigned to titanium racquets? A) $15,000. B) $23,750. C) $25,000. D) $35,000.

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How much inspection cost is assigned to titanium racquets?

Racquet King Corporation manufactures titanium and aluminum tennis racquets. Racquet
King's total overhead costs consist of assembly costs and inspection costs. The following
information is available:
Cost
Titanium
Aluminum
Total Cost
Assembly 500 mach. hours 500 mach. hours $30,000
Inspections 350
150
$50,000
2,100 labor hours 1,900 labor hours
Racquet King is considering switching from one overhead rate based on labor hours to
activity-based costing. Using activity-based costing, how much inspection cost is assigned
to titanium racquets?
A) $15,000.
B) $23,750.
C) $25,000.
D) $35,000.
Transcribed Image Text:Racquet King Corporation manufactures titanium and aluminum tennis racquets. Racquet King's total overhead costs consist of assembly costs and inspection costs. The following information is available: Cost Titanium Aluminum Total Cost Assembly 500 mach. hours 500 mach. hours $30,000 Inspections 350 150 $50,000 2,100 labor hours 1,900 labor hours Racquet King is considering switching from one overhead rate based on labor hours to activity-based costing. Using activity-based costing, how much inspection cost is assigned to titanium racquets? A) $15,000. B) $23,750. C) $25,000. D) $35,000.
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