Variable cost per unit= Total Variable costs($ amount) divided by Production units
Variable cost per unit = Total variable cost / total number of units manufactured
Because variable cost per unit took an arrow to the knee.
Easiest way: Total costs per unit - fixed costs per unit = variable cost per unit. Also recatting into accounting.
Fixed cost / (selling price - Variable cost per unit) --> Fixed cost ----------------------------------------------- (Selling Price - Variable Cost Per Unit)
Variable cost per unit is not dependent on how much units sold but it is dependent on how many units have been produced. For Example: Total units produced: 1000 Total variable cost :10000 Variable cost per unit = 10000/1000 = 10
Total Variable Cost = Number of Units * Variable cost per unit
Formula for Contribution margin is as follows: Contribution margin = Sales price - variable cost So as you can see from above formula that sales price per unit minus variable cost per unit is contribution margin per unit
Variable cost per unit= Total Variable costs($ amount) divided by Production units
Variable cost per unit remains same per unit and has no impact on increase or decrease of sales.
The sales price includes variable cost, the cost of the unit and the markup. Sales price is the rate customers pay for the item.
contribution margin
89900