Tang Company accumulates the following data concerning raw materials in making o

Question

Tang Company accumulates the following data concerning raw materials in making one gallon of finished product: (1) Price—net purchase price $2.63, freight-in $0.40, and receiving and handling $0.42. (2) Quantity—required materials 3.18 pounds, allowance for waste and spoilage 0.78 pounds.

Compute the following. (Round answers to 2 decimal places, e.g. 1.25.)

(a) Standard direct materials price per pound. ______

$

(b) Standard direct materials quantity per gallon. _____

pounds (c) Total standard materials cost per gallon. ______

$

Explanation / Answer

1. Standard direct materials price per pound=purchase price+freight+receiving and handling=$2.63+$0.40+$0.42=$3.45

2.Standard direct materials quantity per gallon=Required material+Wastage=3.18+.78=3.96 pounds

3.Total standard materials cost per gallon=3.96 pounds *$3.45=$13.6620

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