Question:
Sitwell Corporation manufactures titanium and aluminum tennis racquets. Sitwell's total overhead costs consist of assembly costs and inspection costs. The following information is available:
Cost Titanium Aluminum Total Cost
Assembly 500 mach. hours 500 mach. hours $30,000
Inspections 350 150 $50,000
2,100 labor hours 1,900 labor hours
Sitwell is considering switching from one overhead rate based on labor hours to activity-based costing.
Using activity-based costing, how much assembly cost is assigned to titanium racquets?