If the budgeted total cost in fixed overhead is $385000 and the budgeted total quantity is $6730, then budgeted fixed overhead cost per unit will be __________?
Correct answer: A. $57.21 per unit
- A. $57.21 per unit
- B. $67.21 per unit
- C. $77.21 per unit
- D. $87.21 per unit
Explanation
Budgeted fixed overhead per unit is found by dividing total budgeted fixed overhead by budgeted output: $385,000 ÷ 6,730 = approximately $57.21 per unit. Fixed cost per unit changes with the budgeted production volume.
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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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