The formula for computing the materials budget at a given volume is unit material cost multiplied by the number of units.

The formula for computing the materials budget at a given volume is unit material cost multiplied by the number of units.

• A. Multiplication of unit cost by units
• B. Addition of unit cost and units
• C. Division of unit cost by units
• D. Subtraction of units from cost

Answer: (A)

The total materials budget for a planned production volume grows in proportion to how many units you will produce, so you multiply the cost per unit by the number of units. This reflects the idea that each unit requires the same amount of material at the same price, and summing those per-unit costs across all units gives the total cost. For example, if material cost per unit is $2 and you plan to produce 5,000 units, the materials budget is $2 × 5,000 = $10,000. Other operations don’t capture this scaling: adding the unit cost to the number of units blends different units and won’t yield total spend; dividing would produce a per-unit rate rather than a total; subtracting would imply removing a amount rather than accumulating cost.

The total materials budget for a planned production volume grows in proportion to how many units you will produce, so you multiply the cost per unit by the number of units. This reflects the idea that each unit requires the same amount of material at the same price, and summing those per-unit costs across all units gives the total cost. For example, if material cost per unit is $2 and you plan to produce 5,000 units, the materials budget is $2 × 5,000 = $10,000. Other operations don’t capture this scaling: adding the unit cost to the number of units blends different units and won’t yield total spend; dividing would produce a per-unit rate rather than a total; subtracting would imply removing a amount rather than accumulating cost.