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Here is the question : June Pasara is expanding her business. Fixed cost of a trade show is
15,000. The booth is open 30 hours. One product ProOffice will cost $180.00 per package.
Another product EZ Records is new and will cost $100.00 per package. A sales person
will spend 20 hours on EZ and 10 on Pro.
a. Determine the estimated total cost and cost per unit of each assuming the sales
person sells 80 units of EZ and 50 units of Pro.
Hi. I saw your other post. I was sorta letting this one go cause cost accounting is a specialized area and I'm fine with some of it, but not all of it. I know that the cost per unit part they've given you is variable, so that just literally needs multiplied out by how many are being sold.
But total costs are going to include the fixed. I'm not quite sure if that's just being pro-rated based on units, or on the salesperson's time or what. I didn't answer because of that issue. I could be making it difficult, but since cost accounting isn't my specialty, I hate to get into something when I know there might be a different way of doing it. But somehow you do have to get those fixed costs split up.
Getting something PER something is always a division in that order. It can be applied to anything. It's like paying $1 for a dozen eggs. If you wanted to know cost PER egg, you divide cost by eggs: $1/12. Same thing here or anything else like this.
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