General Electric uses ABC to allocate overhead in its appliance division. In March 2041, the following data is provided:

• Activity 1: Machine Hours (50,000 hours, $500,000)
• Activity 2: Setup Hours (2,000 hours, $200,000)
• Activity 3: Inspection Hours (1,000 hours, $100,000)

Requirements:

• Allocate overhead costs to each activity.
• Calculate the cost per activity driver.
• Prepare a report on the cost per unit for a specific product.
• Recommend process improvements based on the ABC analysis.