The following data pertain to costs at Massey Company: The variable cost per unit is
A)$3.76
B)$15.24
C)$19.00
D)$11.48

Question

The following data pertain to costs at Massey Company:  The variable cost per unit is
A)$3.76 
B)$15.24 
C)$19.00 
D)$11.48

Quizplus · Accepted Answer

The variable cost per unit can be calculated by subtracting the total fixed cost ($48,000) from the total cost at the highest activity level ($192,000) and then dividing the result by the total number of units produced at the highest activity level (40,000). This gives: 
Variable cost per unit = ($192,000 - $48,000) / 40,000 = $3.76. Therefore, the answer is choice A.

The Following Data Pertain to Costs at Massey Company