Hurricane Wings has budgeted the following costs for a month in which 24,000 wings will be cooked and sold.
$\begin{array}{lr}
\text { Wings, breading, and sauce } & \$ 4,900 \
\text { Direct labor (Variable) } & 3,500 \
\text { Rent } & 1,10 0\
\text { Depreciation } & 900\
\text { Other fixed costs }&400
\end{array}$
Each wing sells for $0.80 each. How much is the budgeted variable cost per unit?

Question

Quizplus · Accepted Answer

The budgeted variable costs include wings, breading, sauce, and direct labor, totaling $4,900 + $3,500 = $8,400. Dividing by 24,000 wings gives a variable cost per unit of $0.35.

Hurricane Wings Has Budgeted the Following Costs for a Month