Believing that its traditional cost system may be providing misleading information, farragut manufacturing is considering an activity-based costing (abc) approach. it now employs a traditional cost system and has been applying its manufacturing overhead on the basis of machine hours. farragut plans on using 50,000 direct labor hours and 30,000 machine hours in the coming year. the following data show the manufacturing overhead that is budgeted. if farragut employs an activity-based costing system, the cost per unit for the product described for the coming year would be

In december of 2004, the company you own entered into a 20-year contract with a grain supplier for daily deliveries of grain to its hot dog bun manufacturing facility. the contract called for "10,000 pounds of grain" to be delivered to the facility at the price of $100,000 per day. until february 2017, the supplier provided processed grain which could easily be used in your manufacturing process. however, no longer wanting to absorb the cost of having the grain processed, the supplier began delivering whole grain. the supplier is arguing that the contract does not specify the type of grain that would be supplied and that it has not breached the contract. your company is arguing that the supplier has an onsite processing plant and processed grain was implicit to the terms of the contract. over the remaining term of the contract, reshipping and having the grain processed would cost your company approximately $10,000,000, opposed to a cost of around $1,000,000 to the supplier. after speaking with in-house counsel, it was estimated that litigation would cost the company several million dollars and last for years. weighing the costs of litigation, along with possible ambiguity in the contract, what are three options you could take to resolve the dispute? which would be the best option for your business and why?