Massasoit Corporation has contracts to complete weekly supplements required by forty-six customers. For the year 2018, manufacturing overhead cost estimates total $840,000 for an annual production capacity of 10 million pages.

For 2019, Massasoit decided to evaluate the use of additional cost pools. After analyzing manufacturing overhead costs, it was determined that number of design changes, setups, and inspections are the primary manufacturing overhead cost drivers. The following information was gathered during the analysis:

Cost pool Manufacturing overhead costs Activity level

Design changes $ 160,000 200 design changes

Setups 670,000 4,000 setups

Inspections 80,000 16,000 inspections

Total manufacturing overhead costs $910,000

During 2019, two customers, College Systems and Clinic Managers, are expected to use the following printing services:

Activity College Systems Clinic Managers

Pages 60,000 76,000

Design changes 10 2

Setups 20 10

Inspections 30 38

a) If manufacturing overhead costs are considered one large cost pool and are assigned based on 10 million pages of production capacity, what is the cost driver rate?

b) Under ABC costing, what is the inspection cost allocated to Massasoit Corporation?