Answer:
$149,376
Explanation:
For computing the amount of cost of goods sold using the average cost method we need to first find the average cost per unit which is shown below:
= (Beginning inventory units × price per unit + first purchase inventory units × price per unit + second purchase inventory units × price per unit ) ÷ (Beginning inventory units + first purchase inventory units + second purchase inventory units)
= (7,100 units × $11 + 2,800 units × $12 + 11,800 units × $12.5) ÷ (7,100 units + 2,800 units + 11,800 units)
= ($78,100 + $33,600 + $141,600) ÷ (21,700 units)
= ($253,300) ÷ (21,700 units)
= $11.67 per unit
Now the cost of goods sold equals to
= 12,800 units × $11.67 per unit
= $149,376
We simply applied the above formula
