M$4-8$ and M$4-9$

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Acoma Company has identified one of its activity pools to be quality control and has assigned $$125,000$ to that pool. Number of inspections has been chosen as the cost driver for this pool; Acoma performs $25,000$ inspections annually. Suppose Acoma manufactures two products that consume $10,000($Product $1)$ and $15,000($Product $2)$ inspections each.

M$4-9($Static$)$ Assigning Costs Using Activity Proportions $[$LO $4-5]$

Required:

Assume that Acoma manufacturers only the two products mentioned and they consume $100$ percent of the company$$s quality inspections. Using activity proportions, determine how much quality control cost will be assigned to each of Acoma$$s product lines.