Question

Acme-Jones Corporation uses a weighted-average perpetual inventory system. August 2, 28 units were purchased at $21 per unit. August 18, 22 units were purchased at $23 per unit. August 29, 30 units were sold. What was the amount of the cost of goods sold for this sale

Answer 1

Answer:

$656.40

Explanation:

The average perpetual inventory system is one in which the carrying amount of the closing balance is determined by the unit price of every purchase.

As items are purchased/sold out, the closing balance is adjusted with the movement reflected in the account balance.

Average price of purchases per unit

= (28 × $21 + 22 × $23) / (28 +22)

= $1094/50

= $21.88

Since 30 units were sold, cost of goods sold

= $21.88 × 30

= $656.40