If the total incurred cost in a production process are $30000 and the number of output units are 5000 units, then the units cost will be __________?
Correct answer: C. $6
- A. $16
- B. $60
- C. $6
- D. $26
Explanation
Unit cost is found by dividing total production cost by output: $30,000 ÷ 5,000 units = $6 per unit. The other figures result from incorrect multiplication or division.
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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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