If you know the total dollar amount of direct materials purchased but not the actual unit price, which of the following can you use to calculate the unit price?
A)Multiply the total units used by the standard unit price.
B)Divide the total purchases amount by the actual number of units used.
C)Divide the total purchases amount by the actual number of units purchased.
D)Multiply the standard price per unit times the actual quantity used.

Question

Quizplus · Accepted Answer

To calculate the unit price when you know the total dollar amount of direct materials purchased, you divide the total purchases amount by the actual number of units purchased. This gives you the cost per unit.

If You Know the Total Dollar Amount of Direct Materials