Question

Carter Co. sells two products, Arks and Bins. Last year, Carter sold 14,000 units of Arks and 56,000 units of Bins. Related data are: Unit Selling Price $120 Unit Variable Cost $80 60 Product Unit Contribution Arks Bins $40 20 80 What was Carter Co.'s variable cost of
a. $70
b. $64
C. $60
d. $140

Answer 1

Answer:

Variable cost per unit = $64 per unit

so correct option is b. $64

Explanation:

given data

sold Arks = 14,000 units

sold Bins = 56,000 units

products       unit selling price    unit variable cost       unit contibution            

Arks               $120                                $80                              $40

Bins                   80                                   60                                20

to find out

Carter Co.'s variable cost

solution

we get here Variable cost per unit find as

Variable cost per unit = ( Arks unit variable cost ×  sold Arks + Bins unit variable cost ×  sold Bins )  ÷ total sales

Variable cost per unit = $\frac{(80*14000)+(60*56000)}{14000+56000}$

Variable cost per unit = $64 per unit

so correct option is b. $64