Answer:approximately $15.99.
Step-by-step explanation:
To calculate the cost of raw materials per gallon of finished product, we need to consider the price per pound of raw materials and the quantity of raw materials required per gallon of finished product.
Given data:
Price per pound of raw materials:
Net purchase price = $3.20
Freight-in = $0.30
Receiving and handling = $0.40
Quantity per gallon of finished product:
Required materials = 3.20 pounds
Allowance for waste and spoilage = 0.90 pounds
Step 1: Calculate the total cost of raw materials per pound.
Total cost per pound = Net purchase price + Freight-in + Receiving and handling
Total cost per pound = $3.20 + $0.30 + $0.40 = $3.90
Step 2: Calculate the total quantity of raw materials per gallon, including the allowance for waste and spoilage.
Total quantity per gallon = Required materials + Allowance for waste and spoilage
Total quantity per gallon = 3.20 pounds + 0.90 pounds = 4.10 pounds
Step 3: Calculate the cost of raw materials per gallon of finished product.
Cost per gallon = Total cost per pound × Total quantity per gallon
Cost per gallon = $3.90 × 4.10 pounds = $15.99
Therefore, the cost of raw materials per gallon of finished product is approximately $15.99.