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 Production Setup Inspection Shipping Customer service Total Budgeted Activity Cost $400,200 196,000 92,400 108,000 75,600 $872,200 The activity bases identified for each activity are as follows: Activity Activity Base Production Machine hours Setup Number of setups Inspection Shipping Number of inspections 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 3,040 130 240 720 60 7,600 Brown sugar 1,930 190 360 1,980. 380 4,825 Powdered sugar 1,930 180 600 900 160 4,825 Total 6,900 500 1,200 3,600 600 17,250 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 per machine hour per setup Shipping Customer service 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 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 (