a)Calculate the cost per unit of each product using traditional method.

(b)Calculate the cost per unit of each product using activity based costing

Question #2: ABC Co produces 3 products (X, Y & Z) using the same material. Last year annual productions for X, Y and Z are 20,000 units, 16,000 units and 22,000 units respectively. The table below shows direct costs: Product Direct Materials Direct labour ($ 12 per hour) Batch size (units) No of purchase orders per batch Machine hours per unit X $ Per Unit 25 30 500 4 1.5 Y $ Per Unit 28 36 800 5 1.25 X $ Per Unit 22 24 400 4 1.4 The annual indirect production cost is $1,377,400 and divided as following: Cost pools $ Cost drivers Machine set up costs 280,000 Number of batches Material ordering 316,000 Number of purchase Machine running 420,000 Number of machine General facility costs 361,000 Number of machines Total 1,377,400