Activity-Based Product Costing 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 $497,000 Setup 299,900 Inspection 106,800 Shipping 164,000 Customer service 48,400 $1,115,100 Setup The activity bases identified for each activity are as follows: Activity Activity Base Production Machine hours 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 Units Setups Inspections Customer Orders Machine Hours Requests White sugar 3,120 180 240 820 40 7,800 220 Brown sugar 360 2,260 250 4,975 1.990 eBook 250 4,975 110 4,975 400 17,750 Brown sugar 1,990 270 360 2,260 Powdered sugar 1,990 250 600 1,020 Total 7,100 700 1,200 4,100 Each product requires 0.9 machine hour per unit. Required: If required, round all per unit amounts to the nearest cent. 1. Determine the activity rate for each activity. Production 59 x per machine hour Setup 391 X per setup Inspection 78 X per move 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 White sugar