Mello Manufacturing Company is a diversified manufacturer that manufactures three products (Alpha, Beta, and Omega) 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: 1 Activity Activity Cost Pool 2 Production $251,598.00 3 Setup 92,035.00 4 Material handling 10,736.00 5 Inspection 49,833.00 6 Product engineering 136,230.00 7 Total $540,432.00 The activity bases identified for each activity are as follows: Activity Activity Base Production Machine hours Setup Number of setups Material handling Number of parts Inspection Number of inspection hours Product engineering Number of engineering hours The activity-base usage quantities and units produced for the three products were determined from corporate records and are as follows: Machine Number of Number of Number of Number of Hours Setups Parts Inspection Hours Engineering Hours Units Alpha 970 63 84 489 123 1,354 Beta 802 123 138 272 170 1,044 Omega 435 209 266 256 185 452 Total 2,207 395 488 1,017 478 2,850 Each product requires 40 minutes per unit of machine time. Required: Complete the Activity Tables for Alpha, Beta and Omega. 1. Determine the activity rate for each activity.* 2. Use the activity rates in (1) to determine the total and per-unit activity costs associated with all three products.* 3. Why aren't the activity unit costs equal across all three products since they require the same machine time per unit? *If required, round all per-unit amounts to the nearest cent. X Activity Table - Alpha Complete the Activity Table for Alpha. 1. Determine the activity rate for each activity. Enter these rates in the Activity Rate columns.* 2. Use the activity rates in (1) to determine the total and per-unit activity costs associated with Alpha.* *If required, round all per-unit amounts to the nearest cent. Alpha Activity Activity- Base Activity Activity Usage X Rate = Cost Production Setup Material handling Inspection Product Engineering Total activity cost Number of units Activity cost per unit Complete the Activity Table for Beta. 1. Determine the activity rate for each activity. Enter these rates in the Activity Rate columns.* 2. Use the activity rates in (1) to determine the total and per-unit activity costs associated with Beta.* *If required, round all per-unit amounts to the nearest cent. Beta Activity Activity- Base Activity Activity Usage X Rate = Cost Production Setup Material handling Inspection Product Engineering Total activity cost Number of units Activity cost per unit Complete the Activity Table for Omega. 1. Determine the activity rate for each activity. Enter these rates in the Activity Rate columns.* 2. Use the activity rates in (1) to determine the total and per-unit activity costs associated with Omega.* *If required, round all per-unit amounts to the nearest cent. Omega Activity Activity- Base Activity Activity Usage X Rate = Cost Production Setup Material handling Inspection Product Engineering Total activity cost Number of units Activity cost per unit 3. Why aren't the activity unit costs equal across all three products since they require the same machine time per unit? The difference is due to machine inefficiencies. The difference is due to product cost distortions. The difference is because the products consume many activities in ratios different from the volume