One reason for computing the average cost for a product rather than the actual cost is that average cost is easier to compute.

Question

Quizplus · Accepted Answer

Computing the actual cost for a product may involve factors such as varying production costs, overhead expenses, and other variables that make it difficult to calculate. On the other hand, calculating the average cost only involves dividing the total cost by the number of units produced or sold, making it a simpler and more straightforward measure.

One Reason for Computing the Average Cost for a Product