A manufacturing company produces three products: A,B, and C. Units produced of each product for a recent period were 100,000, 40,000, and 20,000 respectively.
Total manufacturing overhead is $6,200,000
Direct costs incurred in production for the period were as follows:
	A	B	C
Direct materials	2,200,000	1,700,000	2,300,000
Direct labor	3,000,000	1,400,000	1,600,000
a) If overhead is allocated to product based on direct labor cost, compute the unit cost of each product.
b) Assume instead that the company uses an ABC system with three activity pools: setups, inspections, and machine costs. The amount of overhead allocated to each pool, and the
usage of each pool by product, are given below. Compute the unit cost of each product using the ABC methodology.
			A	B	C
Setups	2,600,000		50	300	150	500	setups
Inspections	1,500,000		300	700	500	1,500	inspections
Machine costs	2,100,000		23,000	15,000	12,000	50,000	machine hours
	6,200,000
c) Comment briefly on why the two methods yield different results, and which is more accurate.