Final answer:
To calculate the cost per unit for each type of cookie, the sum of Direct Materials, Direct Labor, and Manufacturing Overhead must be divided by the number of units produced. Without the number of units, the cost per unit cannot be computed. Average and marginal cost measurements are crucial for assessing production efficiency and economies of scale.
Step-by-step explanation:
To calculate the total cost per unit for both chocolate chip and oatmeal raisin cookies, we have to sum up the Direct Materials (DM), Direct Labor (DL), and Manufacturing Overhead (MOH) for each type of cookie. Using the provided figures for chocolate chip cookies: DM=$69,272, DL=$83,000; and oatmeal raisin cookies: DM=$58,700, DL=$71,500, with each having an MOH of $90 per unit, we will sum these figures and then divide by the number of units produced to obtain the average cost per unit.
However, to calculate this average cost per unit accurately, we would need to know the number of units produced for both types of cookies. Without this number of units, we cannot determine the total cost per unit.
When firms consider their pricing strategies or need to assess the efficiency of their production, they look at average cost and marginal cost. The average cost provides insight into the cost per unit of output by dividing the total cost by the quantity of output, while marginal cost focuses on the cost of producing one additional unit of output. These cost measures can indicate if a firm is experiencing economies of scale, where average costs decrease as production increases.