Question

For its inspecting cost pool, Ellsworth, Inc. expected overhead cost of $520000 and 4000 inspections. The actual overhead cost for that cost pool was $600000 for 5000 inspections. The activity-based overhead rate used to assign the costs of the inspecting cost pool to products is

Answer 1

Answer:

$130 per inspection

Explanation:

Activity-based overhead rate used = Expected overhead cost ÷ Number of expected inspections = $520,000 ÷ 4000 = $130 per inspection

Therefore, the activity-based overhead rate used to assign the costs of the inspecting cost pool to products is $130 per inspection.