Accounting · Activity Based Costing
A company which makes two products, Alpha and Zeta, uses activity-based costing to absorb its overheads. It has recently identified a new overhead cost pool for inspection costs and has decided that the cost driver is the number of inspections. The following information has been provided: Total inspection costs: $250,000 ParticularsAlphaZetaProduction volume (units)2,5008,000Machine hours per unit11.5Units per batch5001,000Inspections per batch41 What is the inspection cost per unit for product Alpha?
Verified Solution4 OptionsUpdated: October 2026👁️1 View
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- 1$80.00
- 2$71.43✓
- 3$17.24
- 4$23.81
Correct answer
$71.43
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