Question

MegaMouth Inc. Produces two megaphone models, the Boomer and the Blaster. The company makes 15,000 units of the Boomer model and 16,400 of the Blaster model each year. MegaMouth inspects 1 Boomer for every 100 produced and 1 Blaster for every 80 produced. The company expects $11,360 in total inspecting costs for the coming year. What amount of the inspecting costs should be allocated to the Blaster model under activity-based costing

Answer 1

The amount that should be allocated to the Blaster model under activity-based costing is $6560.

How to calculate the costing?

Firstly, the total inspections for Boomer will be:

= 1/100 × 15000

= 150.

The total inspections for Blaster will be:

= 1/80 × 16400

= 205

Total inspections = 150 + 205 = 355

Therefore, the cost will be:

= $32 × (11360/355)

= $6560

Learn more about costing on:

https://brainly.com/question/25109150