Unit Cost vs. Unit Price

Question

Billing > Setup > Standard Item 
 Under the unit tab there is three data entry boxes ( unit cost, unit price, unit of measure). Can someone explain the difference in the "unit cost" and the "unit price"?

ArtMinds · Accepted Answer

In cost accounting, ou can either use "actual" cost or accounting standard called Standard Costing, where you establish "standard" costs for certain items, and then on a company or product level analyze your variances of total cost versus the "standard cost" you have been applying. So "Unit Cost" is the amount you have determined is the most accurate cost on a "unit basis" for that Standard Item. It should logically follow then that "Unit Price" is the price you bill your customer for that Standard Item. The "Unit of Measure" refers to the definition of a "unit" (square foot, linear foot, ounce, pound, etc.). 
 Art Minds Senior Independent Consultant

Sage Construction & Real Estate

Unit Cost vs. Unit Price

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