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If Annual units sold of 1000 Raw Materials has Total Annual Cost of 650 and Building Rent has total annual cost of 9000 What is the cost per unit?
Wiki User
∙ 16y ago
if this building is used in the making of product then it's rent will be gone to indirect overheads and the rent of the building is fixed overhead and included in cost so per unit price will be:
9000+650 = 9650/1000 = 9.65 / unit
if building is not used for the manufacturing of product then it's rent will not be included in cost and unit price will be:
650/1000 = .65 / unit
hope that will help u
Wiki User
∙ 16y ago
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Annual units sold, 1000. Raw materials annual cost 650. Building rent annual cost 9000. If sales volume increased to 6000 units and 8000 units, what is the total annual cost and unit cost for fixed varible? ---------------------------- Cost per unit of raw material=650/1000= 0.65 Fixed cost(Rent)=9000 Fixed cost per unit= 9000/1000= 9.00 If the sales volume increases to 6000 units, then total cost= 12900 and cost per unit = 2.150 Variable cost+ fixed cost= (0.65*6000) + 9000= 12900 / 6000 = 2.15 If the sales volume increases to 8000 units, then total cost= 14200 and cost per unit = 1.775 (0.65*8000) + 9000= 14200 / 8000 = 1.775
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Annual units sold, 1000. Raw materials annual cost 650. Building rent annual cost 9000. If sales volume increased to 6000 units and 8000 units, what is the total annual cost and unit cost for fixed varible? ---------------------------- Cost per unit of raw material=650/1000= 0.65 Fixed cost(Rent)=9000 Fixed cost per unit= 9000/1000= 9.00 If the sales volume increases to 6000 units, then total cost= 12900 and cost per unit = 2.150 Variable cost+ fixed cost= (0.65*6000) + 9000= 12900 / 6000 = 2.15 If the sales volume increases to 8000 units, then total cost= 14200 and cost per unit = 1.775 (0.65*8000) + 9000= 14200 / 8000 = 1.775
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