Samuelson and Messenger (S&M) began 2018 with 200 units of its one product. Thes

Question

Samuelson and Messenger (S&M) began 2018 with 200 units of its one product. These units were purchased near the end of 2017 for $25 each. During the month of January, 100 units were purchased on January 8 for $28 each and another 200 units were purchased on January 19 for $30 each. Sales of 125 units and 100 units were made on January 10 and January 25, respectively. There were 275 units on hand at the end of the month. S&M uses a perpetual inventory system.

Required:

2. Complete the below table to calculate ending inventory and cost of goods sold for January using average cost method

PLEASE HELP ME

Inventory on hand Cost of Goods Sold Perpetual Average |#Of units!Cos | Inventory | # of units | Avg. Cost per unit | Cost of Goods unit Value sold Sold Beginning Inventory Purchase January 8 Subtotal Average Cost Sale - January 10 Subtotal Average Cost Purchase January 19 Subtotal Average Cost Sale January 25 Total 200 25.00 $ 5,000 100 300 125 26.50 425 200 625 100 725 2,800 7,800 3,313 11,113 6,000 17,113 2,782 $ 19,895 28.00 30.00 27.82

Explanation / Answer

Perpetual Average Inventory on Hand Cost of Good sold # of units Cost per unit Inventory value # of units sold Avg. cost per unit Cost of Goods Sold Explanation Beginning Inventory 200 25 5000 Add: Purchase-Jan 8 100 28 2800 Subtotal Average Cost 300 26 7800 7800/300=26 Less: Sale-Jan 10 125 26 3250 Subtotal Average Cost 175 26 4550 Add: Purchase-Jan19 200 30 6000 Subtotal Average Cost 375 28.13 10550 10550/375=28.13 Less: Sale-Jan 25 100 28.13 2813 Ending Inventory 275 28.13 7737 COGS 225 6063 So answering from the above table, Ending Inventory 275 units at av. Cost $ 28.13(rounded to 2 decimals) -total 7737 COGS 225 units -- $ 6063

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