Reynoso corporation manufactures titanium and aluminum tennis racquets. reynoso’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 $27000 inspections 350 150 $8 2100 labor hours 1900 labor hours reynoso is considering switching from one overhead rate based on labor hours to activity-based costing. using activity-based costing, how much inspections cost is assigned to titanium racquets

The inspections cost is assigned to titanium racquets is $56,000

Explanation:

For computing the inspection cost for titanium racquets, we have to compute the per inspection cost which is shown below:

Per inspection cost = (Total inspections cost ÷ total cost)

                                = {$80,000 ÷ (350 + 150)}

                                = 160 per inspection cost

Now the inspection cost equals to

= Titanium cost × per inspection cost

= 350 × 160

= $56,000

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