sweet sugar company

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 $562,500 Setup 255,600 Inspection 150,400 Shipping 126,000 Customer service 38,400 Total $1,132,900 The activity bases identified for each activity are as follows: Activity Activity Base Production 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: The activity-base usage quantities and units produced for the three products were determined from corporate records and are as follows: Number of Number of Customer Number of Service Setups Customer Orders Machine Hours Inspections Requests Units White sugar 3,300 150 320 900 30 8,250 Brown sugar 2,100 230 480 2,480 1905,250 Powdered sugar 2,100 220 800 1,120 80 5,250 Total 7,500 600 1,600 4,500 300 18,750 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 per machine hour Setup per setup Inspection per move Shipping per cust. ord. Customer service per customer service request - 2. Determine the total and per-unit activity cost for all three products. Total Activity Cost Activity Cost Per Unit White sugar Brown sugar 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