Johnson & Johnson is using Activity-Based Costing for its drug manufacturing costs:

• Requirements:
  • Calculate the cost per unit using ABC for a new medication:
    • Direct Costs: $200
    • Indirect Costs: $100
• Implement Standard Cost Accounting to establish cost benchmarks for production.
• Apply Marginal Cost Accounting to assess the cost impact of producing additional units.
• Discuss how each costing method contributes to cost efficiency and profitability in pharmaceutical manufacturing.

Cost Calculation (ABC):

Category	Amount per Unit ($)
Direct Costs	$200
Indirect Costs	$100
Total Cost per Unit	$300