Mcdonald Collins
01/08/2023 · Elementary School
manufacturing a product? Write down the equation used to determine the unit cost of a product. In a manufacturing process, when 1000 units are produced, R10 000 prime costs (assume all are variable costs) are incurred, while the manufacturing overheads amount to R5 000 (assume all are fixed costs). a. Calculate the total cost of productionand the unit cost of the product. b. Now calculate the total cost of production and the unit cost of the product, if the number of units produced increases to 2000 units.
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Unit Cost = (Total Variable Costs + Total Fixed Costs) / Number of Units Produced
a. For 1000 units: Total Cost = R15,000, Unit Cost = R15
b. For 2000 units: Total Cost = R15,000, Unit Cost = R7.50
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