Mello Manufacturing Company is a diversified manufacturer thatmanufactures three products (Alpha, Beta, and Omega) in acontinuous production process. Senior management has asked thecontroller to conduct an activity-based costing study. Thecontroller identified the amount of factory overhead required bythe critical activities of the organization as follows:

1	Activity	Activity Cost Pool
2	Production	$270,840.00
3	Setup	98,945.00
4	Material handling	10,604.00
5	Inspection	44,100.00
6	Product engineering	139,380.00
7	Total	$563,869.00

The activity bases identified for each activity are asfollows:

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 thethree products were determined from corporate records and are asfollows:

	Machine	Number of	Number of	Number of	Number of
	Hours	Setups	Parts	Inspection Hours	Engineering Hours	Units
Alpha	1,061	55	84	467	130	1,341
Beta	767	125	158	281	183	927
Omega	392	205	240	232	192	542
Total	2,220	385	482	980	505	2,810

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 andper-unit activity costs associated with all three products.* 3. Why aren’t the activity unit costs equal across all threeproducts since they require the same machine time per unit? *If required, round all per-unit amounts to the nearestcent.