Microsoft uses activity-based costing (ABC) for its software products. The following information is provided for Product X and Product Y:

Activity	Cost Driver	Total Cost	Product X Usage	Product Y Usage
Coding	Hours	$500,000	2,000 hours	3,000 hours
Testing	Number of tests	$200,000	300 tests	500 tests
Packaging	Units packaged	$100,000	5,000 units	7,000 units

Requirements:

1. Allocate the costs to Product X and Product Y based on their usage.
2. Calculate the total cost for each product.
3. Determine the cost per unit for each product if Product X produced 5,000 units and Product Y produced 7,000 units.
4. Prepare a cost sheet using the ABC method.
5. Analyze the cost allocation and suggest improvements.