Purchase Solution

Variable cost per unit

Not what you're looking for?

Ask Custom Question

I am having trouble calculating variable cost per unit. For example if I am selling hamburgers. My raw materials cost on an annual basis is $650 per 1000 units sold annually. What i am having trouble with is if my annual units rise to 6000 units per year sold, how can I accurately calculate my variable cost. I know my costs will not stay the same at $650. Do I increase my raw material cost 6 times the amount if I am producing 5000 more units over a years time?

Purchase this Solution
Solution Summary

The solution explains how to calculate the variable cost per unit.

Solution Preview

Variable costs are proportional to sale and rise in the same proportion as sales.
When 1000 units are sold, ...

Purchase this Solution
Free BrainMass Quizzes
Writing Business Plans

This quiz will test your understanding of how to write good business plans, the usual components of a good plan, purposes, terms, and writing style tips.

Operations Management

This quiz tests a student's knowledge about Operations Management

Business Processes

This quiz is intended to help business students better understand business processes, including those related to manufacturing and marketing. The questions focus on terms used to describe business processes and marketing activities.

Marketing Research and Forecasting

The following quiz will assess your ability to identify steps in the marketing research process. Understanding this information will provide fundamental knowledge related to marketing research.

Business Ethics Awareness Strategy

This quiz is designed to assess your current ability for determining the characteristics of ethical behavior. It is essential that leaders, managers, and employees are able to distinguish between positive and negative ethical behavior. The quicker you assess a person's ethical tendency, the awareness empowers you to develop a strategy on how to interact with them.

View More Free Quizzes
Related BrainMass Solutions

  • Target selling price

    Instructions (a) Compute the total variable cost per unit, total fixed cost per unit, and total cost per unit for M14 - M16.

  • Variable Cost, how to calculate break even sales?

    187564 Variable Cost: How to Calculate Break Even Sales? 3) xyc Manufactures biotech sunglasses. The variable material cost is $4.68 Per unit and variable cost is $2.27 per unit. a. What is the variable cost per unit? b.

  • Calculate the fixed cost,variable cost & changes in scenario

    Variable Cost = Total cost - Fixed cost = 378000 - 250000 = 128000 Variable cost per unit = 128000/40000 = $3.20 Fixed cost per unit = 250000/40000 = $6.25 B.

  • Total variable manufacturing cost per unit

    overhead $64.60 per unit $33.80 per unit The best estimate of the total variable manufacturing cost per unit is: A) $89.50 B) $18.40 C) $71.10 D) $30.90 Solution: The direct material cost and direct labor cost are variable

  • Fixed Costs and Variable Costs

    The variable cost per unit is: The total variable cost is: The fixed cost per unit is: The total fixed cost is: The total cost for 8,000 units is: The total cost per unit is: (1) Identify which cost item below is fixed and variable and

  • Accounting Fill in the Blanks

    Markup percentage using the variable cost concept = (Desired profit per unit + fixed cost per unit)/ variable cost per unit = (3.2 +(119600/50000))/12 = 5.592/12 = 0.466 or 46.6% 3.

  • Fixed and Variable Cost

    The variable cost per unit is: The total variable cost is: The fixed cost per unit is: The total fixed cost is: The total cost for 8,000 units is: The total cost per unit is: Below is an explanation.

  • Breakeven point

    Decrease Since (BEV) = Total Fixed Cost / (Selling Price per unit - Variable Costs per unit) And denominator (Selling Price per unit - Variable Costs per unit) is decreasing as variable cost per unit is decreasing Answers a question on a firm's

  • Change in Sales Volume and Variable Costs on Net Income

    unit Decrease in revenues $52,500 (750 units*$70/unit) The new variable cost per unit will be: Old variable cost per unit $50.00 per unit Increase in cost 7.50 per unit ($50*.15) New variable cost

  • Difference between fixed and variable cost

    unit Variable cost per unit = $3,900/6,000 units = $0.65 per unit Sales volume = 8,000 units Total Annual Cost = (8,000 x $0.65) + $9,000 = $14,200 Fixed cost per unit = $9,000/8,000 units = $1.125 per unit Variable cost per unit = $5,200/8,000

View More Related Solutions