1. What Is a Unit of Sale?
A unit of sale is what a customer actually buys from you. It’s also the amount of product (or service) you use to figure your operations and profit.
The unit of sale is the basic building block of your business.

2. Student Group Creation
1. Introduce the group ideas and people who created them.
2. Allow them to explain their ideas.
3. Groups will have 4 members (2 will have 5)
4. Once in groups, wait for further instructions!

3. Identifying Expenses Practice 1

4. Start-up Expenses
Variable Expenses
Fixed Expenses

5. Start-up Expenses
Variable Expenses
Fixed Expenses

6. Variable Expenses
A variable expense is an expense that changes based on the amount of product or service a business sells.
The two types of variable expenses are:
Cost of Goods Sold (COGS). For manufacturing and merchandising (retailing and wholesaling) businesses, the variable expense that is associated with each unit of sale is called the cost of goods sold.
Other Variable Expenses. These can include such expenses as commissions for salespeople, shipping and handling charges, or packaging.

7. The Economics of One Unit of Sale
Selling Price – Expenses = Profit (or Loss)
To calculate the economics of one unit of sale, subtract the variable expenses for a unit from the unit’s selling price. The result is the contribution margin. This is the amount per unit that a product contributes toward the company’s profitability before the fixed expenses are subtracted.
Selling Price – Variable Expenses = Contribution Margin

8. Create a Group Banner/Poster
Your team will create a poster or banner. It will include the following:
Business Name
Group Members Name
A big space for a Logo (does not have to be created now)
See Example

9. Selling Price Per Unit
Variable Expenses Per Unit
Costs of Goods Sold
Materials
Labor
Total COGS
Other Variable Expenses
Commision
Packaging
Other
Total Other Variable Expenses
Total Variable Expenses
Contribution Margin Per Unit

10. Selling Price Per Unit
Variable Expenses Per Unit
Costs of Goods Sold
Materials
Labor
Total COGS
Other Variable Expenses
Commision
Packaging
Other
Total Other Variable Expenses
Total Variable Expenses
Contribution Margin Per Unit

11. EOU for a Manufacturing Business
Section 10.2: The Economics of One Unit of Sale

12. EOU for a Wholesale Business
Section 10.2: The Economics of One Unit of Sale

13. EOU for a Retail Business
Section 10.2: The Economics of One Unit of Sale

14. EOU for a Business Selling More Than One Product
Section 10.2: The Economics of One Unit of Sale

15. EOU for a Service Business
Section 10.2: The Economics of One Unit of Sale