Compute activity cost allocation rates $($Learning Objective $2)$

NatureMade Snacks produces different styles of sweet potato chips

$($ruffled$,$ flat, thick$-$cut, gourmet$)$ for different corporate customers.

Each style of sweet potato chip requires different preparation time,

different cooking and draining times $($depending on desired fat

content$),$ and different packaging $($single serving versus bulk$).$

Therefore, NatureMade has decided to try ABC to better capture the

manufacturing overhead costs incurred by each style of chip.

NatureMade has identified the following activities related to yearly

manufacturing overhead costs and cost drivers associated with

producing sweet potato chips:

Compute the activity cost allocation rates for each activity assuming

the following total estimated activity for the year: $8,500$ preparation

hours, $32,000$ cooking and draining hours, and $4$ million packages.