What is difference & impact of unit & bulk qty costing

Question

Accepted Answer

Unit and bulk quantity costing have different impacts on the overall cost of production.

Unit quantity costing involves determining the cost of producing one unit of a product, while bulk quantity costing involves determining the cost of producing a large quantity of the same product.
Unit quantity costing is useful for determining the cost of producing small quantities of a product, while bulk quantity costing is useful for determining the cost of producing large quantities of the same product.
Bulk quantity costing can result in lower costs per unit due to economies of scale, while unit quantity costing may result in higher costs per unit due to higher setup costs.
For example, a company that produces custom-made furniture may use unit quantity costing to determine the cost of producing a single piece of furniture, while a company that produces mass-produced furniture may use bulk quantity costing to determine the cost of producing thousands of the same piece of furniture.

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