Mathematics · Cost Accounting and Relevant Costing
Albrecht has received a request to make a special version of one of its products. This special version will use 2,000 units of material X. Albrecht no longer uses material X, but there are 2,000 units left in inventory purchased at $4.00 per unit. The current purchase price is $4.75 per unit. Albrecht believes it could sell material X for $3.00 per unit. However, material X is similar to material Y that is currently in use by Albrecht and can be purchased for $6.50 per unit. It could use material X in place of material Y; however, it would cost $2.75 per unit to modify material X so that it could be used in place of material Y. What is the relevant cost per unit of material X for the manufacture of the special version?
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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