Unit Cost Calculator
Wastage divides, it does not add.
Unit cost
$11.04
63.2% margin at $29.99
A 5% wastage rate means you need one unit of input divided by 0.950 for each good unit, not multiplied by 1.050. The difference is $0.02 here and it grows with the rate.
How the Unit Cost Calculator works
A 5% wastage rate means you consume one unit of input divided by 0.95 for each good unit, not multiplied by 1.05. The difference is small at low rates and grows quickly, and it is the reason material budgets run short.
Also known as: cost per unit calculator · what does each unit cost me · per piece cost calculator
Not financial advice. Marketplace fees change, and they vary by country, plan and seller status. Every rate here is an editable default, not a quoted price, check the platform's current fee schedule before you price a product against it. This is not tax or business advice.
Frequently asked questions
How is unit cost calculated?
Direct materials, labour and packaging, adjusted for wastage, plus a share of overhead. The wastage adjustment is a division rather than an addition.
Why does wastage divide?
Because the waste happens to the input, not the output. To end up with one good unit at 5% scrap you need 1 ÷ 0.95 = 1.053 units of input, not 1.05.
Should overhead be in unit cost?
For pricing and reporting, yes. For marginal decisions such as whether to accept an extra order, only the variable cost matters.
How do I allocate overhead?
By whatever drives it, machine hours, labour hours or units. Allocating evenly across units when one product consumes far more of a resource distorts every decision downstream.