Sweet Sugar Company manufactures three products (white sugar, brown sugar, and powdered sugar) in a continuous...

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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 $508,200 Setup 170,000 Inspection 102,000 Shipping 120,400 Customer service 53,600 Total $954,200 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: Number of Setups Customer Service Number of Customer Orders Number of Machine Hours Requests Units Inspections: 240 3,390 100 860 40 8,475 White sugar Brown sugar 2,160 150 360 2,370 250 5,400 Powdered sugar 2,150 150 600 1,070 110 5,375 Total 7,700 400 1,200 4,300 400 19,250 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 hoof 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 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 $508,200 Setup 170,000 Inspection 102,000 Shipping 120,400 Customer service 53,600 Total $954,200 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: Number of Setups Customer Service Number of Customer Orders Number of Machine Hours Requests Units Inspections: 240 3,390 100 860 40 8,475 White sugar Brown sugar 2,160 150 360 2,370 250 5,400 Powdered sugar 2,150 150 600 1,070 110 5,375 Total 7,700 400 1,200 4,300 400 19,250 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 hoof 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

Answer rating: 100% (QA)

Answer 1 Determine the activity rate for each activity WHITE SUGAR Activity Activity Base Activity B... View the full answer