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Coca-Cola and PepsiCo are two leading beverage companies known for their iconic soft drink brands. Both companies use process costing to allocate production costs for

Coca-Cola and PepsiCo are two leading beverage companies known for their iconic soft drink brands. Both companies use process costing to allocate production costs for their flagship products.

Scenario: Coca-Cola produces Coca-Cola Classic, while PepsiCo produces Pepsi-Cola. The production costs for each product include direct materials, direct labor, and manufacturing overhead.

Beverage

Direct Materials Cost

Direct Labor Cost

Manufacturing Overhead Cost

Coca-Cola Classic

$0.50

$0.20

$0.30

Pepsi-Cola

$0.45

$0.25

$0.35

Requirements:

  1. Calculate the total manufacturing cost per unit for Coca-Cola Classic.
  2. Determine the total manufacturing cost per unit for Pepsi-Cola.
Compare the production costs and pricing strategies of Coca-Cola and PepsiCo for their flagship beverages.

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