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Consider the scenario below:A TV manufacturer and seller sold 50 units for a total of P3,750,000 worth of television sets for the month of August 2018. Fixed Expenses at P1,000,000 and Variable Expenses at P888,000.Compute for the Variable Expense per unit.Select one:a.20,670b.15,550c.17,760d.27,260

Question

Consider the scenario below:A TV manufacturer and seller sold 50 units for a total of P3,750,000 worth of television sets for the month of August 2018. Fixed Expenses at P1,000,000 and Variable Expenses at P888,000.Compute for the Variable Expense per unit.Select one:a.20,670b.15,550c.17,760d.27,260

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Solution

To compute for the Variable Expense per unit, you need to divide the total Variable Expenses by the total number of units sold.

Given: Total Variable Expenses = P888,000 Total units sold = 50

So, Variable Expense per unit = Total Variable Expenses / Total units sold = P888,000 / 50 = P17,760

So, the correct answer is c. P17,760.

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VARIABLE COSTING

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