Asked by
Kanika Birla
on Nov 12, 2024
Verified
The dollars available from each unit of sales to cover fixed cost and profit are the unit variable cost.
Unit Variable Cost
The cost associated with producing one additional unit of a product, excluding fixed costs.
Fixed Cost
Costs that do not change with the level of production or sales, such as rent, salaries, and insurance.
Profit
The difference between the amounts received from customers for goods or services provided and the amounts paid for the inputs used to provide the goods or services.
- Differentiate between variable costs that fluctuate per unit and fixed costs that vary in total with the level of activity.
Verified Answer
MD
Learning Objectives
- Differentiate between variable costs that fluctuate per unit and fixed costs that vary in total with the level of activity.