Question

Orible Company's standard material cost per unit of output is $10.40 (200 pounds x $0.052). During July, the company purchases and uses 3,150 pounds of materials costing $17,955.

What is the actual material cost per pound in July?
(a) $5.60
(b) $5.70
(c) $5.75
(d) $5.80

Answer 1

The actual material cost per pound for Orible Company in July is calculated by dividing the total cost of materials, $17,955, by the total pounds of materials purchased and used, which is 3,150 pounds. The result is $5.70 per pound.

Step-by-step explanation:

To calculate the actual material cost per pound for Orible Company in July, we need to divide the total cost of materials by the total pounds of materials purchased and used. The calculation is as follows:

Total Cost of Materials = $17,955
Total Pounds of Materials = 3,150 pounds

Actual Cost per Pound = Total Cost of Materials ÷ Total Pounds of Materials
Actual Cost per Pound = $17,955 ÷ 3,150 pounds

Actual Cost per Pound = $5.70

Therefore, the actual material cost per pound in July is $5.70, which corresponds to option (b).