Application of unit level costing

The unit costing is applied particularly more in those industries where large numbers of identical products are produced. This method of costing is applicable in industries like sugar mills, cement, paper works and beverages etc. If there are multiple products it will become difficult to apply unit costing. Thus the cost is ascertained in terms of cost of unit which may be set as per ton of coal, per quintal of sugar, per rim of paper and per unit of bottle etc.
Cost per unit = Total cost of production/ total production units