The formula to calculate the part cost is:
PC=TCP
Where:
Part cost refers to the cost per unit of a product, calculated by dividing the total production cost by the total number of parts produced. This metric is crucial for pricing, budgeting, and financial analysis in manufacturing and production processes.
Example 1:
Using the formula:
PC=50001000=5 $/unit
Example 2:
Using the formula:
PC=75001500=5 $/unit