- 1 Marks
Question
A company produces 16,000 units of a product. The total cost of producing these units is N60,000. If the fixed cost is N12,000, the variable cost per unit of the output is:
A. N7.00
B. N6.00
C. N5.00
D. N4.00
E. N3.00
Answer
E. N3.00
Explanation: The correct answer is E (N3.00). The total variable cost is calculated by subtracting the fixed cost from the total cost. The formula for the variable cost per unit is:
- Tags: Break-even Analysis, Costing, Fixed Costs, Production Efficiency, Variable Cost
- Level: Level 1
- Topic: Mathematics
- Series: MAY 2017
- Uploader: Kwame Aikins