Question

Enviro Corporation manufactures a special liquid cleaner at its Green plant. Operating data for June follow: Materials $ 438,000 Labor 42,000 Manufacturing overhead 234,000 The Green plant produced 1,700,000 gallons in June. The plant never has any beginning or ending inventories. Required: Compute the cost per gallon of liquid cleaner produced in June. (Round your answer to 2 decimal places.)

Answer 1

The cost per gallon of liquid cleaner produced in June is $0.42

Step-by-step explanation:

The computation of the cost per gallon is shown below:

= (Total cost ÷ number of gallons produced)

where,

Total cost = Materials cost + Labor cost + Manufacturing overhead cost

= $438,000 + $42,000 + $234,000

= $714,000

And, the number of gallons produced is 1,700,000 gallons

Now put these values to the above formula

So, the value would equal to

= $714,000 ÷ 1,700,000 gallons

= $0.42