Answer:
Vaughn Manufacturing
The amount allocated to the ending inventory on June 30 is:
$1,590
Explanation:
a) Data and Calculations:
Inventory purchases:
Date Units Cost
June 1 159 units $954
June 10 212 units 1484
June 15 212 units 1696
June 28 159 units 1431
Total 742 $5565
Average cost = $5,565/742 = $7.50
Ending Inventory = 212 * $7.50 = $1,590
Cost of goods sold = Cost of goods available for sale minus the Ending inventory
= $5,565 - $1,590
= $3,975
Alternatively, this can be calculated as follows:
Units of goods sold multiplied by the average cost
= (742 -212) * $7.50
= $3,975
The cost of goods available for sale is made up of the Beginning inventory (if any) plus purchases during the current period. When the ending inventory is subtracted from the cost of goods available for sale, the resulting figure is the cost of goods sold.
