Peabody Company has a single plant, and manufactures three products.
The following table contains per unit data for the three products.
	A	B	C
Raw materials ($)	156	179	185
Direct labor ($)	84	98	70
Machine hours	2.5	2.6	2.1
The following table contains aggregate data for the year for the three products.
	A	B	C
Budgeted production (units)	25,000	18,000	22,000
Number of inspections	250	180	220
Number of setups	100	60	90
Other information:
Wage rate is $28/hour
Budgeted overhead for the year is $13,896,000.
Required:
a) Assume that Peabody uses a traditional costing system, with overhead allocated based on direct labor hours.
Compute the total cost per unit of the three products.

b) Instead assume that Peabody uses an ABC system with three cost drivers: machine hours, inspections, and setups.
Manufacturing overhead cost of $1,300,000 is due to setups, and $130,000 to inspections, with the rest allocated to machine hours.
Compute the total cost per unit of the three products.

c) Identify several possible advantages/disadvantages to Peabody of using the ABC system (limit 200 words).

This is the complete question with the data on the top where it shows Raw Materials for each unit, Direct Labor, Machine Hours,