Question

Intercontinental, Incorporated, uses a perpetual inventory system. Consider the following information about its inventory: July 1, purchased 10 units for $910 or $91 per unit; July 3, purchased 15 units for $1,590 or $106 per unit; July 14, sold 20 units; July 17, purchased 20 units for $2,300 or $115 per unit; July 28, purchased 10 units for $1,190 or $119 per unit; July 31, sold 23 units. Using weighted average, the cost of goods sold for the sale of 23 units on July 31 is ____ and the inventory balance at July 31 is _____.

Answer 1

Using the weighted average method, the cost of goods sold for the sale of 23 units on July 31 is $2,505 (23 x $108.91) and the inventory balance on July 31 is $1,307.

What is the weighted-average method?

The weighted-average method of inventory valuation adds all the costs per period and divides this total by the number of units.

The cost of goods sold and the ending inventory costs are based on the computed average cost.

Data and Calculations:

July 1, purchased 10 units for $910 or $91 per unit;  $910

July 3, purchased 15 units for $1,590 or $106 per unit;  $1,590

July 14, sold 20 units

July 17, purchased 20 units for $2,300 or $115 per unit; $2,300

July 28, purchased 10 units for $1,190 or $119 per unit; $1,190

July 31, sold 23 units.

Total units purchased = 55 units          $5,990

The average (weighted average) cost per unit = $108.91 ($5,990/55)

Total units sold = 43

Ending inventory in units = 12 (55 - 43)

Thus, using the weighted average method, the cost of goods sold for the sale of 23 units on July 31 is $2,505 (23 x $108.91) and the inventory balance on July 31 is $1,307 (12 x $108.91).

Learn more about the weighted average method at brainly.com/question/4576268