Bijay B. answered • 04/13/23
I am a Polymath
The cost per unit is a measure of the total costs involved in creating or delivering a single unit of a good or service. Depending on the type of business and the cost elements involved, many methods can be used to calculate the cost per unit.
All expenses associated with the creation or provision of the unit, including direct expenses like materials and labor and indirect expenses like rent, utilities, and depreciation, must be tallied up in order to determine the cost per unit. The cost per unit is calculated by taking the entire cost and dividing it by the quantity produced or given.
The cost per unit is determined, for instance, by dividing the total cost by the number of units produced, which yields a cost per unit of $10 if a company pays $10,000 to produce 1,000 units of a product.
