Accounting · Relevant Costing (Material Cost)
Albert needs 2,000 units of material X for a special order. Material X is no longer used regularly, but 2,000 units remain in inventory (originally purchased at $4.00/unit). The current purchase price is $4.75/unit, and scrap resale value is $3.00/unit. However, material X can substitute for material Y (currently in use, costing $6.50/unit) if modified at a cost of $2.75/unit. What is the relevant cost per unit of material X for this special order?
Verified Solution4 OptionsUpdated: October 2026👁️1 View
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- 1$4.75
- 2$4.00
- 3$3.75✓
- 4$3.00
Correct answer
$3.75
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