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Activity based costing

A Co. makes tow types of bars for bicycles. It requires 1 hour of labor to make one bar of either type. During the most recent accounting period, the Co made 8,000 steel bars and 2,000 titanium bars. Set up costs amounted to $48,000 for the 24 batches (i.e., 12 of each type) of bars produced during the period.
If activity-based costing is used to allocate over head costs to the two products, the amount of set up costs assigned to the titanium bars will be??

Solution Summary

Solution explains how to allocate cost using activity based costing.

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