estbank Question 172 Megan Industries manufactures several products including a basic case for a popular smart phone. The company is considering adopting an activity-based costing approach for setting its budget. The companys production activities, budgeted activity costs, and cost drivers for the coming year are as follows. Activity Activity overhead $ Cost driver Cost driver quantity Machine setup $178,850 # of setups 730 Inspection 180,360 # of quality tests 540 Materials receiving 193,050 # of purchase orders 1,950 The budgeted data for smart phone case production are as follows. Direct materials $2.50 per unit Direct labor $0.65 per unit Number of setups 90 Number of quality tests 413 Number of purchase orders 62 Production 19,500 units Collapse question part (a) Calculate the activity rate for each cost pool. Machine setup $ per setup Inspection $ per test Materials receiving $ per PO