Question

One of Hartman Company's activity cost pools is inspecting, with estimated overhead of $140,000. Hartman produces throw rugs (700 inspections) and area rugs (1,300 inspections). How much of the inspecting cost pool should be assigned to throw rugs

Answer 1

the cost assigned to throw rugs is $49,000

Step-by-step explanation:

The computation of the cost assigned to throw rugs is shown below:

Cost assigned is

= Estimated overhead × number of inspections ÷ total number of inspections

= $140,000 × 700 ÷ (700 + 1300)

= $49,000

hence, the cost assigned to throw rugs is $49,000

We simply applied the above formula so that the correct value could come

And, the same is to be considered