5. Calculate the overhead allocated to each product unit. 6. Combine the overhead and direct costs to give the cost per unit Labour HR Machine setup Parts administration Production orders Materials received Machine running Overhead per unit Product A (2,000 units) Product B (10,000 units) Product A Product B 16,000 64,000 90,000 60,000 100,000 60,000 17,500 52,500 18,000 72,000 75,000 175,000 316,500 483,500 158 48 Direct materials Direct labour Overhead Product A Product B Unit product cost using ABC costing Compare this with the unit product cost calculated using conventional costing Product A Product B 25 17 60 48 158 243 165 48 113 129