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?

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Quizplus · Accepted Answer

The inspecting cost pool is allocated based on the number of inspections. Throw rugs have 700 inspections out of a total of 2,000 inspections (700 for throw rugs + 1,300 for area rugs). Therefore, the cost assigned to throw rugs is (700/2000) * $140,000 = $49,000.

One of Hartman Company's Activity Cost Pools Is Inspecting, with Estimated