lily3934
17.02.2020 •
Mathematics
The cost element that is responsible for the fluctuating unit costs is Manufacturing Overhead. The reason being is because it is being incurred instead of being applied on a predetermined basis. Overhead costs cannot be assigned to specific jobs on the basis of actual costs incurred. Direct Materials and Labor are both consistent in costs per batch; for example, when dividing the cost of Direct Materials for each quarter by the production batches for each quarter, the unit cost for batch equals $20,000. Likewise, when dividing the cost of Direct Labor for each quarter for each batch of each quarter, the unit cost for batch equals $12,000 per quarter.
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