The highest value of total cost was $70,000 in June for Acai Beverages,Inc.Its lowest value of total cost was $52,000 in December.The company makes a single product.The production volume in June and December were 13,000 and 7000 units,respectively.What is the variable cost per month? (Round your answer to the nearest cent.)
A) $1.38 per unit
B) $2.57 per unit
C) $3.00 per unit
D) $11.67 per unit

Question

Quizplus · Accepted Answer

Variable cost per unit = Change in total cost / Change in volume of activity
Variable cost per unit = (Highest cost - Lowest cost) / (Highest volume - Lowest volume) 11ea8873_d51f_f845_bb89_33295e567859_TB5026_00 Variable cost per unit = $3.00 per unit

The Highest Value of Total Cost Was $70,000 in June