Answer:
Average cost of inventory =$6,911.3
Step-by-step explanation:
Given:
Opening inventory cost = 190 unit × $7.30 = $1,387
Purchase cost 1 = 720 unit × $7.30 = $5,256
Purchase cost 2 = 590 unit × $5.80 = $3,422
Total cost of inventory = $1,387 + $5,256 + $3,422
Total cost of inventory = $10,065
Total selling price = 1030 unit × $14
Total selling price = $14,420
Computation of average cost of inventory for 1,030 units
Average cost of inventory = Total cost of inventory × [1030/(190+720+590)]
Average cost of inventory = 10,065 × [1030/1,500]
Average cost of inventory = 6,911.3
