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 Setup $497,000 212,000 Inspection Shipping Customer service Total 117,000 140,400 34,800 $1,001,200 The activity bases identified for each activity are as follows: Activity Production Activity Base 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: Number of Setups Number of Machine Hours Inspections White cu 2 non 130 260 Number of Customer Orders Customer Service Requests Units 720 30 7.700 Customer Number of Number of Number of Service Setups Customer Orders Machine Hours Inspections Requests Units White sugar 3,080 130 260 720 30 7,700 Brown sugar 1,960 190 390 1,980 190 4,900 Powdered sugar 1,960 180 650 900 80 4,900 Total 7,000 500 1,300 3,600 300 17,500 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 Setup Inspection Shipping Customer service SA per machine hour per setup per move per cust. ord. per customer service request 2. Determine the total and per-unit activity cost for all three products. White sugar Brown sugar Powdered sugar Total Activity Cost Activity Cost Per Unit 2. Determine the total and per-unit activity cost for all three products. White sugar Brown sugar Total Activity Cost Activity Cost Per Unit 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