A factory is engaged in manufacturing plastic buckets. Sales: Rs.1,00,000, Direct Labour Cost (1000 units) = Rs.10,000, Direct Material Cost (1000 units) = Rs.25,000, Direct Expenses (1000 units) = Rs.5,000, Fixed Cost = Rs.30,000. Find out Variable cost per unit and the Total Cost.

Question

Accepted Answer

Given (for 1,000 units):
- Direct Labour Cost = ₹10,000
- Direct Material Cost = ₹25,000
- Direct Expenses = ₹5,000
- Fixed Cost = ₹30,000

**Variable Cost per unit:**
Total Variable Cost = Direct Labour + Direct Material + Direct Expenses
= 10,000 + 25,000 + 5,000 = ₹40,000

Variable Cost per unit = Total Variable Cost / Number of units
= 40,000 / 1,000 = ₹40 per unit

**Total Cost:**
Total Cost = Total Variable Cost + Fixed Cost
= 40,000 + 30,000 = ₹70,000

The variable cost per unit is ₹40 and the total cost is ₹70,000.