Question

Determine the ending inventory using the periodic inventory system and the weighted average cost method (rounded to the nearest cent or two decimal places), assuming that 18 units were sold at a price of $14. Date Item Units Cost Total June 1 Beginning inventory 6 $5 $30 June 12 Purchase 10 6 60 June 18 Purchase 8 7 56 Totals 24 $146

Answer 1

Answer:

The ending inventory is

Units        Unit Cost        Total

6           $6,35        $38,1

Explanation:

AVCO Perpetual chart is attached.  

AVCO Perpetual chart shows purchases , sales and balance of each period. Highlighted you will find the balance at the end of every purchase or sale.  

When you have a purchase: Use the following formula to get the weighted-average cost by unit:

(P₁*Q₁)+(P₂*Q₂)/(Q₁+Q₂)

P₁ and Q₁ are the balance from operation that you made before.  

P₂ and Q₂ is the data of the new operation (new purchase)

When you have a sale: you only discount the Quantity and use the average cost by unit to get the final inventory.  

The balance at the end of June is:

Units        Unit Cost        Total

6           $6,35        $38,1

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