Fred bought a mobile hot dog stand. After a year of operations he is trying to understand his costs per unit better. He sells a hot dog, bag of chips, and bottle of soft drink as a bundled unit for $3. He estimated his costs for next year, based on 5,000 sales units as follows:

Cost	Budgeted Annual Costs
Hot Dogs	$ 2,500.00
Gas Cost for Hot Dog Stand	$ 450.00
Bagged Snack Foods	$ 2,250.00
Insurance	$ 400.00
Soft Drinks	$ 6,250.00
Hot Dog Buns	$ 1,250.00
Depreciation on Hot Dog Stand	$ 550.00

Based on the budgeted costs, catagorize the costs into two groups. The first group should include all the direct costs associated with each sale. The second catagory should include all the indirect costs.

What is the total for all the direct costs? What is the total for all the indirect costs? if you calculated an indirect cost application rate based on the budgeted 5,000 units sold, what would be the application rate per unit?