What Is the Difference Between the Average Cost Per Unit

question 26

Multiple Choice

What is the difference between the average cost per unit for 5 units and the marginal cost of the 5th unit?

• A)196
• B)86
• C)40.
• D)110.

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Definitions:

Journal Entry

A record in the books of accounts that represents a single financial transaction, documented in chronological order and showing the debits and credits for each transaction.

Terms N/30

Payment terms indicating that an invoice must be paid within 30 days of the invoice date.

Allowance Method

An accounting technique used to account for bad debts, estimating and setting aside a portion of accounts receivable that may not be collectible.

Percent of Sales Method

A financial forecasting model that estimates future elements of a financial statement as a percentage of sales.