Unit Cost: Definition, Formula & Calculation


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What is the unit cost?

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1. Which of the following is a fixed cost?

2. Company Z produces 10,000 units in a year. It has fixed costs of $50,000, direct labor costs of $50,000, and direct material costs of $100,000. What is the unit cost for Company Z's product?

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About This Quiz & Worksheet

You can use this printable worksheet and interactive quiz to help you understand the concept of the cost of producing one unit of any particular product. You'll be tested on various factors that contribute to the establishment of the unit cost.

Quiz & Worksheet Goals

In these assessments, you'll be tested on your familiarity with the following:

  • Resultant unit cost if the number of units produced is reduced by a certain percentage
  • The definition of unit cost
  • Examples of fixed and variable costs
  • Determine a unit cost by way of an illustrative example

Skills Practiced

The worksheet and quiz allow you to practice the following skills:

  • Reading comprehension - ensure that you draw the most important information from the related lesson on unit cost
  • Making connections - use your understanding of the concept of unit cost
  • Interpreting information - verify that you can read information regarding factors that affect the determination of unit cost and interpret it correctly
  • Knowledge application - use your knowledge to answer questions about the determination of unit cost

Additional Learning

To learn more about the idea of unit cost, review the accompanying lesson entitled Unit Cost: Definition , Formula & Calculation. The lesson focuses on the following objectives:

  • Discuss why the actual unit cost for an item might be measured in the thousands or millions of dollars
  • Translate this formula into English: UC =c/u
  • Comment on the three types of costs that make up total costs
  • Differentiate between fixed and variable costs