The total cost (TC)of an item is calculated as TC = F + VX,where V is the
A)estimated volume of production
B)variable cost per unit of activity.
C)total variable costs
D)actual volume of production

Question

Quizplus · Accepted Answer

The variable cost per unit of activity (V) is used to calculate the total cost (TC) of an item, along with the fixed cost (F) and the level of activity or quantity produced (X). The estimated volume of production (A) and the actual volume of production (D) are not directly used in the calculation of TC. Total variable costs (C) can be a component of V, but V itself is the rate or cost per unit of activity.

The Total Cost (TC)of an Item Is Calculated as TC