Jezebel Company incurred fixed costs of $300,000. Total costs, both fixed and variable, are $450,000 when 50,000 units are produced. It sold 35,000 units during the year. Calculate the variable cost per unit.

Question

Quizplus · Accepted Answer

The total variable cost is the total cost minus the fixed cost, which is $450,000 - $300,000 = $150,000. The variable cost per unit is $150,000 / 50,000 units = $3.

Jezebel Company Incurred Fixed Costs of $300,000