At a sales volume of 43,000 units, Choice Corporation's sales commissions (a cost that is variable with respect to sales volume) total $580,500.

At a sales volume of 43,000 units, Choice Corporation's sales commissions (a cost that is variable with respect to sales volume) total $580,500.

To the nearest whole cent, what should be the average sales commission per unit at a sales volume of 40,400 units? (Assume that this sales volume is within the relevant range.)

Garrison 16e Rechecks 2017-08-01

Multiple Choice

• $13.19
• $12.87
• $14.19
• $13.50

  Correct

Explanation

Sales commission per unit = Total sales commissions ÷ Unit sales = $580,500 ÷ 43,000 = $13.50

The average sales commission per unit is constant within the relevant range.