Johnson & Johnson produces two types of medical supplies, Band-Aids and Gauze Pads. The following cost data is available:

Cost Item	Band-Aids	Gauze Pads
Direct Material	$0.2/unit	$0.3/unit
Direct Labor	$0.1/unit	$0.15/unit
Overhead	200% of direct labor cost	180% of direct labor cost

Additional Information:

• Production for Band-Aids: 5,000,000 units
• Production for Gauze Pads: 3,000,000 units

Requirements:

1. Calculate the total cost for Band-Aids and Gauze Pads.
2. Determine the cost per unit for each medical supply.
3. Prepare a cost sheet for both supplies.
4. Analyze the cost structure and suggest which product is more cost-effective.
5. Discuss the implications of cost structure on pricing strategy and profitability.