Johnson & Johnson manufactures pharmaceutical products using batch costing. In January 2036, the company produces 5 batches of medicine costing $2,500,000 in total. Batch sizes vary from 10,000 to 20,000 units per batch.

Required:

• Allocate costs to each batch based on batch size.
• Calculate the cost per unit for each batch.
• Determine the total cost of production assuming 100,000 units are produced.
• Prepare a cost report showing the cost allocation to each batch and the total production cost.
• Analyze how batch size affects unit cost and profitability.