Starbucks and Dunkin' are two leading coffeehouse chains known for their diverse menu offerings and global presence. Both companies use process costing to allocate production costs for their coffee-based beverages.

Scenario: Starbucks produces its signature Espresso-based beverages, while Dunkin' manufactures its popular Iced Coffee drinks. The production costs for each beverage include ingredients, labor, and overhead.

• Starbucks' Espresso Production Costs:
  • Direct Materials Cost per unit: $1.50
  • Direct Labor Cost per unit: $0.75
  • Manufacturing Overhead Cost per unit: $0.50
• Dunkin's Iced Coffee Production Costs:
  • Direct Materials Cost per unit: $1.25
  • Direct Labor Cost per unit: $0.50
  • Manufacturing Overhead Cost per unit: $0.40

Requirements:

1. Calculate the total manufacturing cost per unit for Starbucks' Espresso beverages.
2. Determine the total manufacturing cost per unit for Dunkin's Iced Coffee drinks.
3. Compare the production costs and pricing strategies of Starbucks and Dunkin' for their coffee-based beverages.