Nestl S.A. produces confectionery products using process costing. In February 2027, the company incurs the following costs related to its production process: Mixing and Blending

Nestlé S.A. produces confectionery products using process costing. In February 2027, the company incurs the following costs related to its production process:

• Mixing and Blending Costs: $20 million
• Molding and Packaging Costs: $15 million
• Quality Assurance Costs: $5 million

Required:

• Allocate production costs between mixing and blending, and molding and packaging departments using the direct allocation method.
• Determine the cost per unit produced assuming 10 million units manufactured.
• Analyze the cost structure of process costing in the confectionery industry.
• Discuss the role of cost allocation in managing production costs at Nestlé S.A.
• Prepare a process costing statement for Nestlé S.A.'s confectionery production.