Starbucks Corporation produces two types of beverages, Coffee and Tea. The following cost data is available:

Cost Item	Coffee	Tea
Direct Material	$1/unit	$0.7/unit
Direct Labor	$0.4/unit	$0.3/unit
Overhead	200% of direct labor cost	180% of direct labor cost

Additional Information:

• Production for Coffee: 3,000,000 units
• Production for Tea: 2,500,000 units

Requirements:

1. Calculate the total cost for Coffee and Tea.
2. Determine the cost per unit for each beverage.
3. Prepare a cost sheet for both beverages.
4. Compare the cost structures and suggest which beverage is more profitable.
5. Recommend strategies for cost reduction and efficient pricing.