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In the standard cost formula Y = a + bX, what does the "b" represent? A)...

In the standard cost formula Y = a + bX, what does the "b" represent?

A) variable cost per unit

B) total fixed cost

C) total cost

D) the level of activity

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Answer #1

In this standard cost formula;

Y represents total cost

a=Total fixed costs

b=Variable cost per unit

x=the level of activity

Hence the correct option is:

variable cost per unit

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