How to calculate Average Unit Costs?

• Formula for average unit costs

  Total costs divided by units sold
• Quantity of packets sold for Choc Sesh is 500,000 units
• Costs for Choc Sesh

  • Rent: £26,000
  • Wages: £170,000
  • Advertising: £19,000
  • Components or raw materials: £600,000
  • Other costs: £60,000
• Total costs for Choc Sesh is £875,000
• Total costs divided by units sold


  Calculates the average unit cost
• The average unit cost for Choc Sesh is £1.75
• Economies of scale may be related to this topic