Question
The relevant operating range of Adens Corporation is 2,000 units to 6,000 units. The average costs per unit when it produces and sells 4,000 units
The relevant operating range of Adens Corporation is 2,000 units to 6,000 units. The average costs per unit when it produces and sells 4,000 units are as follows:
Average Cost Per Unit | ||
Direct materials | $ | 6.25 |
direct labor | $ | 2.80 |
Variable production load | $ | 1.55 |
Fixed production load | $ | 2.40 |
Fixed selling expense | $ | 0.50 |
Fixed administrative expense | $ | 0.40 |
Sales commissions | $ | 1.00 |
Variable administrative expense | $ | 0.50 |
If 5,000 units are sold, calculate the variable cost per unit sold .
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Management Accounting
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