3. Capacity measures (10 points) Kennywood Inc., a manufacturing firm, is able to produce 1,300 pairs of pants per hour, at maximum efficiency. There are three eight-hour shifts each day. Due to unavoidable operating interruptions, production averages 850 units per hour. The plant actually operates only 28 days per month. Based on the current budget, Kennywood estimates that it will be able to sell only 500,000 units due to the entry of a competitor with aggressive marketing capabilities. But the demand is unlikely to be affected in future and will be around 519,000. Assume the month has 30 days. Fixed manufacturing costs per month are $850,000. Fixed manufacturing overhead is allocated on a per pair of pants basis. a. What is the theoretical fixed manufacturing overhead rate per pair of pants for the next month? b. What is the practical fixed manufacturing overhead rate per pair of pants for the next month? c. What is the normal fixed manufacturing overhead rate per pair of pants for the next month? d. What is the master-budget fixed manufacturing overhead rate per pair of pants for the next month? e. List the pros and cons of using each capacity measure that can be used to determine manufacturing overhead per pair of pants