An average cost is also known as________?
Correct answer: B. Unit cost
- A. Variable cost
- B. Unit cost
- C. Total cost
- D. Fixed cost
Explanation
Average cost is total cost divided by the number of units produced, which is also called unit cost. Variable cost and fixed cost describe cost behaviour, not the per-unit average measure.
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About Cost Accounting
Cost accounting measures and analyses the cost of producing goods or providing services for planning, control and pricing decisions. It covers direct and indirect costs, fixed and variable costs, job and process costing, break-even analysis, marginal costing, overhead allocation, and the difference between product cost and period cost.
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