Activity-Based Product Costing Setup Sweet Sugar Company manufactures three products (white sugar, brown sugar, and powdered sugar) in a continuous production process. Senior management has asked the controller to conduct an activity-based costing study. The controller identified the amount of factory overhead required by the critical activities of the organization as follows: Activity Budgeted Activity Cost Production $475,800 170,800 Inspection 88,000 Shipping 144,000 Customer service 58,000 Total $936,600 The activity bases identified for each activity are as follows: Activity Activity Base Production Machine hours Setup Number of setups inspection Number of inspections Shipping Number of customer orders Customer service Number of customer service requests The activity-base usage quantities and units produced for the three products were determined from corporate records and are as follows: Customer Number of Number of Number of Service Setups Customer Orders Machine Hours Inspections Requests Units White sugar 3,430 100 220 720 50 8,575 Brown sugar 2,180 330 1,980 320 5,450 Powdered sugar 2,190 150 550 900 130 5,475 Total 7,800 400 1,100 3,600 500 19,500 Each product requires 0.9 machine hour per unit. 150 Required: If required, round all per unit amounts to the nearest cent. 1. Determine the activity rate for each activity. Production per machine hour per setup Setup Inspection Shipping per move per cust. ord Customer service per customer service request 2. Determine the total and per-unit activity cost for all three products If required, round all per unit amounts to the nearest cent. 1. Determine the activity rate for each activity, Production per machine hour Setup per setup Inspection Shipping per cust. ord Customer service per customer service request 2. Determine the total and per-unit activity cost for all three products Total Activity Cost Activity Cost Per Unit per move White sugar Brown sugar Powdered sugar 3. Why aren't the activity unit costs equal across all three products since they require the same machine time per unit? The unit costs are different because the products consume many activities in ratios different from the